<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-Q
(X) Quarterly Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the Quarterly Period Ended March 31, 1996
or
( )Transition Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the Transition Period From _________ To _________
Commission File Number: 1-13848
OAKLEY, INC.
(Exact name of registrant as specified in its charter)
Washington 95-3194947
---------- ----------
(State or other jurisdiction of (IRS Employer ID No.)
incorporation or organization)
10 Holland
Irvine, California 92718
------------------ -----
(Address of principal (Zip Code)
executive offices)
(714) 951-0991
--------------
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No
----- -----
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Common Stock, par value $.01 per share 35,700,525 shares
- -------------------------------------- -----------------
(Class) (Outstanding on May 10, 1996)
<PAGE>
OAKLEY, INC.
INDEX TO FORM 10-Q
PART I. FINANCIAL INFORMATION
ITEM 1 - Financial Statements
Consolidated Balance Sheets as of December 31, 1995
and March 31, (unaudited).............................................. 3
Consolidated Statements of Income for the three-month periods
ended March 31, 1995 and 1996 (unaudited).............................. 4
Consolidated Statements of Cash Flows for the three-month periods
ended March 31, 1995 and 1996 (unaudited).............................. 5
Notes to Consolidated Financial Statements.............................. 6
ITEM 2 - Management's Discussion and Analysis of Results of
Operations and Financial Condition..................................... 7-10
PART II. OTHER INFORMATION
ITEM 1 - Legal Proceedings.............................................. 11
ITEM 2 - Changes in Securities.......................................... 11
ITEM 3 - Defaults Upon Senior Securities................................ 11
ITEM 4 - Submission of Matters to a Vote of Security Holders............ 11
ITEM 5 - Other Information.............................................. 11
ITEM 6 - Exhibits and Reports on Form 8-K............................... 12-13
Signatures.............................................................. 14
Exhibits................................................................ 15
2
<PAGE>
OAKLEY, INC.
CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
ASSETS
<TABLE>
<CAPTION>
December 31,1995 March 31, 1996
------------------ -----------------
(unaudited)
<S> <C> <C>
CURRENT ASSETS:
Cash and cash equivalents $ 9,760 $ 16,879
Accounts receivable, less allowance
for doubtful accounts of $591 (1995),
$618 (1996) 19,288 24,775
Inventories 20,488 22,548
Other receivables 348 1,514
Deferred income taxes 3,562 3,534
Prepaid expenses 1,731 2,019
------------------ -----------------
Total current assets 55,177 71,269
PROPERTY AND EQUIPMENT, net 38,888 43,613
OTHER ASSETS 316 319
DEFERRED TAX ASSET 190 190
DEPOSITS 3,154 1,479
------------------ -----------------
TOTAL ASSETS $ 97,725 $ 116,870
------------------ -----------------
------------------ -----------------
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
S distribution notes $ 263 $ -
Accounts payable 7,123 8,571
Accrued expenses and other current
liabilities 6,601 6,844
Income taxes payable 2,029 8,713
------------------ -----------------
Total current liabilities 16,016 24,128
SHAREHOLDERS' EQUITY
Preferred stock, par value $.01 per
share: 10,000,000 shares authorized;
no shares issued - -
Common stock, par value $.01 per share:
100,000,000 shares authorized;
35,700,000 issued and outstanding 357 357
Additional paid-in capital 64,427 64,429
Retained earnings 16,998 27,971
Foreign currency translation adjustment (73) (15)
------------------ -----------------
Total shareholders' equity 81,709 92,742
TOTAL LIABILITIES AND ------------------ -----------------
SHAREHOLDERS' EQUITY $ 97,725 $ 116,870
------------------ -----------------
------------------ -----------------
</TABLE>
See accompanying notes to consolidated financial statements.
3
<PAGE>
OAKLEY,INC.
CONSOLIDATED STATEMENTS OF INCOME
(IN THOUSANDS EXCEPT PER SHARE DATA)
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended March 31,
--------------------------------
1995 1996
-------------- -------------
<S> <C> <C>
Net sales $ 36,615 $ 48,706
Cost of goods sold 11,356 14,642
-------------- -------------
Gross profit 25,259 34,064
Operating expenses:
Research and development 6,660 949
Selling 7,470 10,091
Shipping and warehousing 1,001 1,423
General and administrative 3,692 3,948
-------------- -------------
Total operating expenses 18,823 16,411
-------------- -------------
Operating income 6,436 17,653
Interest expense (income), net 30 (189)
-------------- -------------
Income before provision for income taxes 6,406 17,842
Provision for income taxes 270 6,869
-------------- -------------
Net income $ 6,136 $ 10,973
-------------- -------------
-------------- -------------
Net income per share $ 0.31
-------------
-------------
Weighted average common shares used in the
calculation of net income per share 35,916
-------------
-------------
</TABLE>
See accompanying notes to consolidated financial statements
4
<PAGE>
OAKLEY, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS) (UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended March 31,
--------------------------------
1995 1996
-------------- -------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 6,136 $ 10,973
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization 1,772 1,876
Gain on disposition of equipment (12) (98)
Deferred compensation - 2
Changes in assets and liabilities:
Accounts receivable (3,124) (5,487)
Inventories (3,270) (2,060)
Deferred income taxes - 28
Other receivables 590 (1,166)
Prepaid expenses 242 (288)
Other assets (285) (3)
Accounts payable (1,811) 1,448
Due to shareholders 6,493 -
Accrued expenses and other current
liabilities 170 243
Income taxes payable - 6,684
-------------- -------------
Net cash provided by operating activities 6,901 12,152
CASH FLOWS FROM INVESTING ACTIVITIES:
Deposits (1,495) 1,675
Acquisitions of property and equipment (3,026) (6,696)
Proceeds from sale of equipment 12 193
-------------- -------------
Net cash used in investing activities $ (4,509) $ (4,828)
-------------- -------------
-------------- -------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayments of bank borrowings (1,265) -
Dividends paid (1,000) (263)
Net cash used in financing activities (2,265) (263)
EFFECT OF EXCHANGE RATE CHANGES ON CASH 28 58
NET INCREASE IN CASH AND CASH EQUIVALENTS 155 7,119
CASH AND CASH EQUIVALENTS, beginning of period 1,692 9,760
-------------- -------------
CASH AND CASH EQUIVALENTS, end of period $ 1,847 $ 16,879
-------------- -------------
-------------- -------------
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest $ 36 $ 3
-------------- -------------
-------------- -------------
Income taxes $ - $ 157
-------------- -------------
-------------- -------------
</TABLE>
See accompanying notes to consolidated financial statements
5
<PAGE>
OAKLEY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1 - BASIS OF PRESENTATION
The accompanying consolidated financial statements of Oakley, Inc. and its
wholly-owned subsidiaries (the "Company") have been prepared pursuant to the
rules and regulations of the Securities and Exchange Commission ("SEC").
Accordingly, they do not include all of the information and footnotes required
by generally accepted accounting principles ("GAAP") for complete financial
statements.
In the opinion of management, the consolidated financial statements contain all
adjustments, consisting only of normal recurring adjustments, considered
necessary for a fair statement of the balance sheets as of December 31, 1995 and
March 31, 1996, the statements of income for the three month periods ended March
31, 1995 and 1996 and the statements of cash flows for the three month periods
ended March 31, 1995 and 1996. The results of operations for the three month
period ended March 31, 1996 are not necessarily indicative of the results of
operations for the entire fiscal year ending December 31, 1996.
NOTE 2 - INITIAL PUBLIC OFFERING
In August 1995, the Company completed an initial public offering of 3,300,000
shares of the Company's common stock for $23.00 per share, netting proceeds to
the Company after underwriting discounts and expenses of approximately $69.1
million.
NOTE 3 - INCOME TAXES
Prior to August 14, 1995, Oakley, Inc. elected to be treated as an S corporation
under the provisions of the Internal Revenue Code. Accordingly, the provisions
for income taxes for the periods through August 14, 1995 are computed by
applying the California franchise tax rate for S corporations of 1.5% to Oakley,
Inc.'s pretax earnings plus the foreign taxes related to Oakley Europe.
Effective August 14, 1995, the Company converted to a C corporation and became
subject to regular Federal and state income taxes on an ongoing basis. As a
result, the Company recorded $1.6 million of deferred income tax assets on
August 14, 1995.
NOTE 4 - CREDIT AGREEMENT
Oakley, Inc. has a line of credit to allow maximum borrowings of $18.0 million.
At March 31, 1996, there was no balance outstanding on the line of credit.
6
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion includes the operations of Oakley, Inc. and
subsidiaries for each of the periods discussed.
RESULTS OF OPERATIONS
The following table sets forth operating results for the 1996 period and pro
forma operating results for the 1995 period indicated. Pro forma operating
results reflect adjustments to the historical operating results for (i) the
elimination of bonuses paid to the two principal executive officers in excess of
$0.5 million in the aggregate (the estimated bonuses payable for each quarter of
1995 under the Performance Bonus Plan adopted by the Company in August 1995),
(ii) the elimination of all depreciation expense associated with aircraft owned
by the Company, which aircraft were distributed to the two principal
shareholders in August 1995 as part of the S corporation distribution and (iii)
Federal and state income taxes as if the Company had been taxed as a C
corporation for all periods prior to the Company's initial public offering.
CONSOLIDATED STATEMETS OF INCOME
(IN THOUSANDS EXCEPT PER SHARE DATA)
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
-------------------------------
1995 1996
---------- ----------
<S> <C> <C>
Net Sales $ 36,615 $ 48,706
Cost of goods sold 11,356 14,642
---------- ----------
Gross profit 25,259 34,064
Operating expenses:
Research and development 730 949
Selling 7,116 10,091
Shipping and warehousing 1,001 1,423
General and administrative 2,609 3,948
---------- ----------
Total operating expenses 11,456 16,411
---------- ----------
Operating income 13,803 17,653
Interest expense (income), net 30 (189)
---------- ----------
Income before provision for income taxes 13,733 17,842
Provision for income taxes 5,507 6,869
---------- ----------
Net income $ 8,266 $ 10,973
---------- ----------
---------- ----------
Earnings per share $ 0.26 $ 0.31
Weighted average shares outstanding 32,400 35,916
</TABLE>
7
<PAGE>
Three Months Ended March 31, 1996 and 1995
NET SALES
Net sales increased to $48.7 million for the three months ended March 31,
1996 from $36.6 million for the three months ended March 31, 1995, an
increase of $12.1 million, or 33.1%. This increase was principally the
result of substantially higher sales in the 1996 period for the EYE JACKET
sunglasses, sales from TRENCHCOAT sunglasses (introduced in late 1995) and
significant sales increases of WIRES. These increases were partially offset
by moderate sales decreases in M FRAMES and ZEROS sunglasses and significant
sales decreases in FROGSKINS, the Company's most mature product offering.
The decline in FROGSKINS sales was attributable in part to a 50% reduction in
the number of models offered. The Company's international sales grew 71.7%
to $18.2 million, or 37.4% of net sales, in the 1996 period from $10.6
million, or 29.0% of net sales, in the comparable 1995 period. This increase
was principally a result of substantially increased sales in the continental
European markets in which the Company sells on a direct basis and higher
sales to distributors in most of the Company's other foreign markets.
GROSS PROFIT
Gross profit increased to $34.1 million for the three months ended March 31,
1996 from $25.3 million for the three months ended March 31, 1995, an increase
of $8.8 million, or 34.8%. As a percentage of net sales, gross profit
increased to 70.0% in the 1996 period from 69.1% in the 1995 period as a result
of a lower lens reject rate, a higher average selling price (resulting from a
shift in product mix and higher international prices), a reduction in inventory
shrinkage, better margins in the Company's direct European operation and greater
manufacturing throughput, partially offset by slightly higher prices on raw
materials, increases in sales to international distributors at favorable prices
and higher sales returns and discounts as a percentage of sales.
OPERATING EXPENSES
Operating expenses decreased to $16.4 million for the three months ended March
31, 1996 from $18.8 million for the three months ended March 31, 1995, a
decrease of $2.4 million. This decrease resulted primarily from the reduction
in the level of bonuses payable since the Company's initial public offering in
August 1995. On a pro forma basis as discussed above, operating expenses
increased to $16.4 million in the 1996 period from $11.5 million in the 1995
period, an increase of $4.9 million, or 42.6%. Selling expenses increased $3.0
million in the 1996 period principally as a result of additional personnel in
sports marketing, advertising and sales, higher warranty costs and higher
depreciation on the Company's store displays, partially offset by, as a
percentage of sales, lower sports marketing and advertising expenses, lower
trade show expenses and lower professional fees. Warranty expense in 1996
benefited from the initiation in mid-year 1995 of a $9.39 warranty processing
charge per unit, which contributed offsetting income of $0.2 million in the 1996
period. Shipping expenses increased $0.4 million in the 1996 period to $1.4
million from $1.0 million in the 1995 period. As a percentage of net sales,
shipping expenses increased to 2.9% in the 1996 period from 2.7% in the 1995
period as a result of significantly higher average shipping costs in the
Company's direct European operation, partially offset by lower average shipping
costs in domestic markets. General and administrative expenses increased $1.3
million in the 1996 period from the 1995 period as the Company added the
personnel and infrastructure necessary in response to its growth, including
increased salaries, insurance and other expenses associated with being a public
company, partially offset by lower professional fees. In addition, general and
administrative expenses increased as a result of a significant investment in
management information systems, both in personnel and hardware/software. As a
percentage of net sales, general and administrative expenses increased to 8.0%
of net sales in the 1996 period from 7.1% in the 1995 period.
8
<PAGE>
OPERATING INCOME
The Company's operating income grew to $17.7 million for the three months ended
March 31, 1996 from $6.4 million for the three months ended March 31, 1995, an
increase of $11.3 million. On a pro forma basis as discussed above, operating
income increased to $17.7 million for the 1996 period from $13.8 million for the
comparable 1995 period, an increase of $3.9 million, or 28.3%. This increase
was a result of the Company's net sales growth and an improvement in its gross
margin, partially offset by higher operating expenses as a percentage of net
sales.
INTEREST EXPENSE, NET
The Company had interest expense of $3,000 and interest income of $192,000 for
the three months ended March 31, 1996, as compared with interest expense of
$36,000 and interest income of $6,000 for the comparable 1995 period.
INCOME TAXES
Prior to August 14, 1995, Oakley, Inc. elected to be treated as an S corporation
under the provisions of the Internal Revenue Code. Accordingly, the provisions
for income taxes for the periods through August 14, 1995 are computed by
applying the California franchise tax rate for S corporations of 1.5% to Oakley,
Inc.'s pretax earnings plus the foreign taxes related to Oakley Europe.
Effective August 14, 1995, the Company converted to a C corporation and became
subject to regular Federal and state income taxes on an ongoing basis. As a
result, the Company recorded $1.6 million of deferred income tax assets on
August 14, 1995. The Company recorded a provision for income taxes of $6.9
million for the three months ended March 31, 1996, as compared to $0.3 million
for the comparable 1995 period. On a pro forma basis as discussed above, the
Company's provision for income taxes was $5.5 million for the 1995 period.
NET INCOME
The Company's net income increased to $11.0 million for the three months ended
March 31, 1996 from $6.1 million for the three months ended March 31, 1995, an
increase of $4.9 million. On a pro forma basis as discussed above, net income
increased to $11.0 million for the 1996 period from $8.3 million for the 1995
period, an increase of $2.7 million, or 32.5%.
LIQUIDITY AND CAPITAL RESOURCES
The Company historically has financed its operations almost entirely with cash
flow generated from operations. Cash provided by operating activities rose to
$12.2 million for the three months ended March 31, 1996 from $6.9 million for
the comparable 1995 period. On a pro forma basis as discussed above, cash
provided by operating activities was $8.4 million for the three months ended
March 31, 1995. At March 31, 1996, working capital was $47.1 million. Working
capital may vary from time to time as a result of seasonality, new product
introductions, capital expenditures, including purchases of equipment, and
changes in inventory levels. To supplement cash flow from operations, if
necessary, the Company maintains an $18.0 million revolving credit facility to
be used for general working capital purposes. The credit agreement relating to
such facility contains typical covenants with respect to the conduct of the
Company's business and requires the maintenance of various financial levels and
ratios. At March 31, 1996, there was no balance outstanding on the line of
credit. The Company believes that available cash, cash flow from operations and
available borrowings will be sufficient to meet operating needs and capital
expenditures, including the cost of constructing the Company's new
headquarters/manufacturing facility, for the foreseeable future.
Capital expenditures (other than for the construction of the Company's new
facility) for the three months ended March 31, 1996 totaled $4.8 million. The
Company estimates that its capital expenditures (other than for the Company's
new facility) will total $16.5 million for 1996, including approximately $4.5
million relating to the development and production of the X METAL line. In
April
9
<PAGE>
1995, the Company purchased land for $8.2 million on which it is constructing a
larger headquarters/manufacturing facility. The Company currently estimates
that the cost to construct and equip such facility will be approximately $32.0
million, of which $5.1 million was spent in 1995 and $1.9 million was spent in
the first quarter of 1996. The remainder is expected to be spent by late 1996
or early 1997 when the Company expects to relocate to such facility.
Prior to the Company's initial public offering in August 1995, as a result of
the Company's treatment as an S Corporation for Federal and state income tax
purposes, the Company historically has provided its shareholders with funds for
the payment of income taxes on the earnings of the Company which have been
included in the taxable income of the shareholders. In addition, the Company
historically has paid dividends to shareholders to provide them with a return on
their investment. The Company paid dividends of $1.0 million in the 1995
period. Upon consummation of such offering, the Company's S corporation status
was terminated. In August 1995, the Company declared a distribution of its
previously undistributed S corporation earnings, which was paid through the
distribution of aircraft and S distribution notes. The actual amount of the S
distribution notes was $19.3 million, all of which had been repaid by March 31,
1996.
SEASONALITY
Historically, the Company's sales, in the aggregate, generally have been higher
in the period from March to September, the period during which sunglass use is
typically highest. As a result, operating margins are typically lower in the
first and fourth quarters as fixed operating costs are spread over generally
lower sales volume. In anticipation of seasonal increases in demand, the
Company typically builds inventories in the fourth quarter and first quarter
when net sales have historically been lower. In addition, the Company's
shipments of goggles, which generate gross margins at significantly lower levels
than sunglasses, are lowest in the second quarter. This seasonal trend
contributes to the Company's gross margin in the second quarter, which
historically has been the highest of the year. Although the Company's business
generally follows this seasonal trend, the success of the Company's products
introduced since late 1993 and the Company's international expansion have
mitigated the impact of seasonality.
BACKLOG
Historically, the Company has generally shipped domestic orders (other than
preseason orders for ski goggles and orders from certain sunglass specialty
chains) within one day of receipt and international orders within two weeks of
receipt. The Company's backlog has increased since mid-1995 primarily due to an
increase in market demand. At March 31, 1996, the Company had a backlog of
$18.7 million, including backorders (merchandise remaining unshipped beyond its
scheduled shipping date) of $1.8 million.
INFLATION
The Company does not believe inflation has had a material impact on the Company
in the past although there can be no assurance that this will be the case in the
future.
10
<PAGE>
PART II - OTHER INFORMATION
ITEM 1. Legal Proceedings
None
ITEM 2. Changes in Securities
None
ITEM 3. Defaults Upon Senior Securities
None
ITEM 4. Submission of Matters to a Vote of Security-Holders
None
ITEM 5. Other Information
None
11
<PAGE>
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
The following exhibits are included herein:
*3.1 Articles of Incorporation of the Company
*3.2 Bylaws of the Company
*10.1 Credit Agreement (the "Credit Agreement"), dated June 20, 1995,
between Oakley, Inc., Wells Fargo Bank, National Association, and
the Lenders named therein
*10.2 Collateral Account Agreement, dated June 20, 1995, between
Oakley, Inc. and Wells Fargo Bank, National Association, as agent
for the Lenders party to the Credit Agreement
*10.3 Security Agreement, dated June 20, 1995, between Oakley, Inc. and
Wells Fargo Bank, National Association, as agent for the Lenders
party to the Credit Agreement
*10.4 Security Agreement and Chattel Mortgage, dated June 20, 1995,
between Oakley, Inc. and Wells Fargo Bank, National Association,
as agent for the Lenders party to the Credit Agreement
*10.5 Trademark Collateral Security Agreement, dated June 20, 1995,
between Oakley, Inc. and Wells Fargo Bank, National Association,
as agent for the Lenders party to the Credit Agreement
*10.6 Patent Collateral Security Agreement, dated June 20, 1995,
between Oakley, Inc. and Wells Fargo Bank, National Association,
as agent for the Lenders party to the Credit Agreement
*10.7 Subordination Agreement, dated June 20, 1995, between Oakley,
Inc., Buffalo Works, Inc., James H. Jannard and Mike D. Parnell
**10.8 Credit Agreement (the "Amended and Restated Credit Agreement"),
dated August 15, 1995, between Oakley, Inc., Wells Fargo Bank,
National Association, as agent and the Lenders named therein
**10.9 Collateral Account Agreement, dated August 15, 1995, between
Oakley, Inc. and Wells Fargo Bank, National Association, as agent
for the Lenders party to the Amended and Restated Credit
Agreement
**10.10 Guaranty, dated August 15, 1995, by the Guarantors named therein
and Wells Fargo Bank, National Association, as agent for the
Lenders party to the Amended and Restated Credit Agreement
**10.11 Shareholder Pledge Agreement (original and English translation),
dated August 15, 1995 between Oakley, Inc. and Wells Fargo Bank,
National Association, as agent for the Lenders party to the
Amended and Restated Credit Agreement
**10.12 Subordination Agreement, dated August 15, 1995 between the
Initial Subordinated Creditors named therein and Wells Fargo
Bank, National Association, as agent for the Lenders party to the
Amended and Restated Credit Agreement
**10.13 Promissory Note, dated August 8, 1995 between Oakley, Inc. and
James H. Jannard
**10.14 Promissory Note, dated August 8, 1995 between Oakley, Inc. and M.
and M. Parnell Revocable Trust
***10.15 Termination and Release Agreement, dated as of August 15, 1995
between Oakley, Inc. and Wells Fargo Bank, National Association,
as agents for the Lenders party to the Credit Agreement
***10.16 First Amendment to Amended and Restated Credit Agreement dated
November 22, 1995 by and among Oakley, Inc., Wells Fargo Bank,
National Association, as agent and the Lenders named therein
**10.17 Agreement, dated July 17, 1995, between Oakley, Inc. and Michael
Jordan
*10.18 Lease, dated September 15, 1988, between OO Partnership and
Oakley, Inc.
***10.19 First Amendment to Lease dated December 31, 1995, by and between
Oakley, Inc., and OO Partnership
12
<PAGE>
*10.20 Agreement, dated July 31, 1995, between OO Partnership and
Oakley, Inc.
*10.21 Lease, dated March 5, 1990, between Weyerhauser Mortgage Company
and Oakley, Inc., as amended
*10.22 Sublease, dated August 17, 1992, between Western Digital
Corporation and Oakley, Inc., as amended
*10.23 Purchase Agreement and Escrow Instructions, dated December 9,
1994, between Oakley, Inc. and Foothill Ranch Development
Corporation
***10.24 Oakley, Inc. 1995 Stock Incentive Plan
***10.25 Oakley, Inc. Amended and Restated 1995 Stock Incentive Plan
***10.26 Oakley, Inc. Executive Officer Performance Bonus Plan
*10.27 Employment Agreement, dated as of August 1, 1995, between Oakley,
Inc. and Jim Jannard
*10.28 Employment Agreement, dated as of August 1, 1995, between Oakley,
Inc. and Mike Parnell
*10.29 Employment Agreement, dated as of August 1, 1995, between Oakley,
Inc. and Link Newcomb
***10.30 Indemnification Agreement, dated August 1, 1995, between Oakley,
Inc. and Jim Jannard
*10.31 Schedule of indemnification agreements between Oakley, Inc. and
each of its directors and executive officers
*10.32 Standard Form of Agreement between Owner and Project Manager,
dated December 30, 1994, between Oakley, Inc. and Snyder Langston
*10.33 Lease Agreement, dated January 26, 1995, between Oakley Europe,
sarl and Investipierre 7 (In French with English translation)
***10.34 Aircraft Lease Agreement, dated August 10, 1995, between Oakley,
Inc. and X, Inc.
***10.35 Aircraft Lease Agreement, dated August 10, 1995, between Oakley,
Inc. and Time Tool Incorporated
*10.36 Registration Rights Agreement, dated August 1, 1995, between
Oakley, Inc., Jim Jannard and the M. and M. Parnell Revocable
Trust
***10.37 Indemnification Agreement, dated August 9, 1995, between Oakley,
Inc., Jim Jannard and the M. and M. Parnell Revocable Trust
27.1 Financial Data Schedule
* Previously filed with the Registration Statement on Form S-1 of Oakley,
Inc. (Registration No. 33-93080)
** Previously filed with the Form 10-Q of Oakley, Inc. for the quarter ended
September 30, 1995.
*** Previously filed with the Form 10-K of Oakley, Inc. for the year ended
December 31, 1995.
The Company did not file any reports on Form 8-K during the three months ended
March 31, 1996.
13
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Oakley, Inc.
May 10, 1996 /s/ JIM JANNARD
---------------------
Jim Jannard
Chairman and President
May 10, 1996 /s/ LINK NEWCOMB
---------------------
Link Newcomb
Executive Vice President and
Chief Financial Officer
May 10, 1996 /s/ DONNA GORDON
---------------------
Donna Gordon
Vice President of Finance
14
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> MAR-31-1996
<CASH> 16,879
<SECURITIES> 0
<RECEIVABLES> 24,775
<ALLOWANCES> 618
<INVENTORY> 22,548
<CURRENT-ASSETS> 71,269
<PP&E> 43,613
<DEPRECIATION> 0
<TOTAL-ASSETS> 116,870
<CURRENT-LIABILITIES> 24,128
<BONDS> 0
0
0
<COMMON> 357
<OTHER-SE> 92,385
<TOTAL-LIABILITY-AND-EQUITY> 116,870
<SALES> 48,706
<TOTAL-REVENUES> 48,706
<CGS> 14,642
<TOTAL-COSTS> 14,642
<OTHER-EXPENSES> 16,411
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> (189)
<INCOME-PRETAX> 17,842
<INCOME-TAX> 6,869
<INCOME-CONTINUING> 10,973
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 10,973
<EPS-PRIMARY> 0.31
<EPS-DILUTED> 0
</TABLE>
