<PAGE> 1
Registration No. 333-_________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
___________________________
FORM S-8
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
__________________
NICHOLAS FINANCIAL, INC.
(Exact name of registrant as specified in its charter)
British Columbia, Canada 8736-3354
(State or other jurisdiction (I.R.S. Employer
of Identification No.)
incorporation or organization)
33759
2454 McMullen Booth Road (Zip Code)
Building C
Clearwater, Florida
(Address of principal
executive offices)
Nicholas Financial, Inc.
Employee Stock Option Plan
(Full title of the plan)
Copy to:
Peter L. Vosotas
President and Chief Executive Todd B. Pfister
Officer Foley & Lardner
Nicholas Financial, Inc. 100 North Tampa Street, Suite
2454 McMullen Booth Road 2700
Building C Tampa, Florida 33602-5804
Clearwater, Florida 33759 (813) 229-2300
(727) 726-0763
(Name, address and telephone
number,
including area code, of agent
for service)
__________________________
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
Title of Amount to Proposed Proposed Amount of
Securities be Maximum Maximum Registration
to be Registered Offering Aggregate Fee
Registered Price Per Offering
Share Price
- ----------------------------------------------------------------
<C> <C> <C> <C> <C>
Voting 350,000 $3.58(1) $1,252,792(1) $349
Common shares
Stock,
No par
value
<FOOTNOTE>
(1) Estimated pursuant to Rules 457(c) and (h) under the
Securities Act of 1933 solely for the purpose of calculating the
registration fee based on the offering prices of 200,200 shares
of Voting Common Stock and the average of the bid and asked price
of 149,800 shares of Voting Common Stock as reported on the
Nasdaq Small-Cap Market on June 28, 1999.
</TABLE>
<PAGE> 2
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
The document or documents containing the information
specified in Part I are not required to be filed with the
Securities and Exchange Commission ("Commission") as part of this
Form S-8 Registration Statement.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The following documents have been previously filed by
Nicholas Financial, Inc. (the "Company") with the Commission and
are incorporated herein by reference:
(a) The Company's Annual Report on Form 10-KSB for the
fiscal year ended March 31, 1999, which includes audited
financial statements as of and for the year ended March 31, 1999.
(b) All other reports filed by the Company or the Plan
pursuant to Section 13(a) or 15(d) of the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), since March 31, 1999.
(c) The description of the Company's Common Stock
contained in Item 8 of the Company's Registration Statement on
Form 10-SB, as filed with the Commission pursuant to Section 12
of the Exchange Act on August 28, 1995, and any amendments or
reports filed for the purpose of updating such description.
All documents subsequently filed by the Company or the
Plan pursuant to Sections 13(a), 13(c), 14 and 15(d) of the
Exchange Act after the date of filing of this Registration
Statement and prior to such time as the Company files a post-
effective amendment to this Registration Statement 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 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.
<PAGE> 3
Item 6. Indemnification of Directors and Officers.
The Articles of the Company provide that the Directors
shall cause the Company to indemnify a director or former
director of the Company and the heirs and personal
representatives of any such person against all costs, charges and
expenses actually and reasonably incurred by an indemnified
party, including an amount paid to settle an action or satisfy a
judgment in a civil, criminal or administrative action or
proceeding to which they are made a party by reason of being or
having been a director, including any action brought by the
Company. The Articles also provide that the directors may cause
the Company to indemnify, to the same extent as for directors,
any officer, employee or agent of the Company or any director,
officer, employee or agent of the Company's subsidiaries.
Item 7. Exemption from Registration Claimed.
Not Applicable.
Item 8. Exhibits.
The following exhibits have been filed (except where
otherwise indicated) as part of this Registration Statement:
Exhibit No. Exhibit
(4) Nicholas Financial, Inc. Employee Stock Option Plan
(5) Opinion of Salley Bowes Harwardt
(23.1) Consent of Ernst & Young LLP
(23.2) Consent of Salley Bowes Harwardt (contained in
Exhibit 5 hereto)
(24) Power of Attorney relating to subsequent amendments
(included on the signature page to this
Registration Statement)
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 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.
(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 herein, 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.
<PAGE> 4
(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 plan'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
herein, 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 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.
<PAGE> S-1
SIGNATURES
The Registrant. 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
Clearwater, and State of Florida, on this 21st day of May, 1999.
NICHOLAS FINANCIAL, INC.
By: /s/ Peter L. Vosotas
---------------------
Peter L. Vosotas,
President and Chief
Executive Officer
POWER OF ATTORNEY
Pursuant to the requirements of the Securities Act of
1933, this Registration Statement has been signed below by the
following persons in the capacities and on the dates indicated.
Each person whose signature appears below constitutes and
appoints Peter L. Vosotas and Ralph T. Finkenbrink, and each of
them individually, his or her true and lawful attorney-in-fact
and agent, with full power of substitution and revocation, for
him or her and in his or her name, place and stead, 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, 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
connection therewith, as fully to all intents and purposes as he
or she might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or either
of them, may lawfully do or cause to be done by virtue hereof.
Signature Title Date
--------- ------ ------
/s/ Peter L. Vosotas President, Chief May 21, 1999
- ---------------------- Executive Officer,
Peter L. Vosotas Chairman of the
Board (Principal
Executive Officer)
and Director
/s/ Ralph T. Finkenbrink Vice President - May 21, 1999
- -------------------------- Finance(Principal
Ralph T. Finkenbrink Financial and
Accounting Officer)
/s/ Stephen Bragin Director May 21, 1999
- -------------------
Stephen Bragin
/s/ Dr. Ellis Hyman Director May 21, 1999
- ---------------------
Dr. Ellis Hyman
/s/ William Taylor Director May 21, 1999
- ---------------------
William Taylor
<PAGE> 6
EXHIBIT INDEX
NICHOLAS FINANCIAL, INC. EMPLOYEE STOCK OPTION PLAN
Exhibit No. Exhibit
(4) Nicholas Financial, Inc.
Employee Stock Option Plan
(5) Opinion of Salley Bowes Harwardt
(23.1) Consent of Ernst & Young LLP
(23.2) Consent of Salley Bowes Harwardt
(contained in Exhibit 5 hereto)
(24) Power of Attorney relating to
subsequent amendments (included
on the signature page to this
Registration Statement)
<PAGE> 7
Exhibit 4
NICHOLAS FINANCIAL, INC.
EMPLOYEE STOCK OPTION PLAN
<PAGE> 8
Exhibit 4
TABLE OF CONTENTS
Page
1. PURPOSE OF PLAN..................................1
2. DEFINITIONS......................................1
3. LIMITS ON OPTIONS................................2
4. GRANTING OF OPTIONS..............................3
5. TERMS OF STOCK OPTIONS...........................3
6. EFFECT OF CHANGES IN CAPITALIZATION..............5
7. DELIVERY AND PAYMENT FOR SHARES;
REPLACEMENT OPTIONS..............................7
8. NO CONTINUATION OF EMPLOYMENT AND
DISCLAIMER OF RIGHTS.............................8
9. ADMINISTRATION...................................8
10. NO OBLIGATION TO RESERVE OR RETAIN SHARES........9
11. AMENDMENT OF PLAN................................9
12. TERMINATION OF PLAN..............................9
13. EFFECTIVE DATE...................................9
<PAGE> 9
Exhibit 4
NICHOLAS FINANCIAL, INC.
EMPLOYEE STOCK OPTION PLAN
1. Purpose of Plan
The purpose of this Plan is to enable Nicholas Financial,
Inc. (the "Company") and its Subsidiaries to compete successfully
in attracting, motivating and retaining Employees with
outstanding abilities by making it possible for them to purchase
Shares on terms that will give them a direct and continuing
interest in the future success of the businesses of the Company
and its Subsidiaries and encourage them to remain in the employ
of the Company or one or more of its Subsidiaries. Each Option
is intended to be an Incentive Stock Option, except to the extent
that (a) any such Option would exceed the limitations set forth
in Section 3.(c) hereof and (b) for Options specifically
designated at the time of grant as not being Incentive Stock
Options.
2. Definitions
For purposes of the Plan, except where the context clearly
indicates otherwise, the following terms shall have the meanings
set forth below:
(a) "Board" means the Board of Directors of the Company.
(b) "Code" means the United States Internal Revenue Code
of 1986, as amended.
(c) "Committee" means the Committee described in Section
9 hereof.
(d) "Effective Date" means the date the Plan is adopted
by the Board.
(e) "Employee" means a person who is regularly employed
on a salary basis by the Company or any Subsidiary, including
an officer or director of the Company or any Subsidiary who is
also an employee of the Company or a Subsidiary.
(f) "Fair Market Value" means, with respect to a Share,
if the Shares are then listed and traded on a registered
national or regional securities exchange, or quoted on The
National Association of Securities Dealers' Automated
Quotation System ( including The Nasdaq National Market),
the average closing price of a Share on such exchange or
quotation system for the five trading days immediately
preceding the date of grant of an Option, or, if Fair Market
Value is used herein in connection with any event other than
the grant of an Option, then such average closing price for
the five trading days immediately preceding the date of such
event. If the Shares are not traded on a registered
securities exchange or quoted in such a quotation system, the
Committee shall determine the Fair Market Value of a Share.
(g) "Incentive Stock Option" means an option granted
under this Plan and which is an incentive stock option within
the meaning of section 422 of the Code, or the corresponding
provision of any subsequently enacted tax statute.
<PAGE> 10
Exhibit 4
(h) "Option" means an option granted under this Plan,
whether or not such option is an Incentive Stock Option.
(i) "Optionee" means any person who has been granted an
Option which Option has not expired or been fully exercised or
surrendered.
(j) "Plan" means the Company's Employee Stock Option
Plan.
(k) "Rule 16b-3 " means Rule 16b-3 promulgated pursuant
to Section 16(b) of the Securities Exchange Act of 1934, as
amended, or any successor rule.
(l) "Share" means one share of voting common stock, no
par value, of the Company, and such other stock or securities
that may be substituted therefor pursuant to Section 6 hereof.
(m) "Subsidiary" means any corporation, limited liability
company, partnership or other entity of which a majority of
the outstanding voting stock or voting power is beneficially
owned directly or indirectly by the Corporation. For Incentive
Stock Options, the term shall have the meaning set forth in
Section 424(f) of the Code.
3. Limits on Options
(a) The total number of Shares with respect to which
Options may be granted under the Plan shall not exceed in the
aggregate 350,000 Shares, subject to adjustment as provided in
Section 6 hereof. If any Option expires, terminates or is
terminated for any reason prior to its exercise in full, the
Shares that were subject to the unexercised portion of such
Option shall be available for future grants under the Plan.
(b) No Incentive Stock Option shall be granted to any
Employee who at the time such option is granted, owns capital
stock of the Company possessing more than 10% of the total
combined voting power or value of all classes of capital stock
of the Company or any Subsidiary, determined in accordance
with the provisions of Section 422(b)(6) and 424(d) of the
Code, unless the option price at the time such Incentive Stock
Option is granted is at least 110 percent (110%) of the Fair
Market Value of the Shares subject to the Incentive Stock
Option and such Incentive Stock Option is not exercisable by
its terms after the expiration of five (5) years from the date
of grant.
<PAGE> 11
Exhibit 4
(c) An Incentive Stock Option shall be granted hereunder
only to the extent that the aggregate Fair Market Value
(determined at the time the Incentive Stock Option is granted)
of the Shares with respect to which such Incentive Stock
Option and any other "incentive stock option" (within the
meaning of Section 422 of the Code) are exercisable for the
first time by any Optionee during any calendar year (under the
Plan and all other plans of the Optionee's employer
corporation and its parent and subsidiary corporations within
the meaning of Section 422(d) of the Code) does not exceed
$100,000. This limitation shall be applied by taking Incentive
Stock Options and any such other "incentive stock options"
into account in the order in which such Incentive Stock
Options and any such other "incentive stock options" were
granted.
(d) No Optionee shall, in any calendar year, be granted
Options to purchase more than 100,000 Shares. Options granted
to the Optionee and cancelled during the same calendar year
shall be counted against such maximum number of Shares. In the
event that the number of Options which may be granted is
adjusted as provided in the Plan, the above limit shall
automatically be adjusted in the same ratio.
4. Granting of Options
The Committee is authorized to grant Options to selected
Employees pursuant to the Plan beginning on the Effective Date.
Subject to the provisions of the Plan, the Committee shall have
exclusive authority to select the Employees to whom Options will
be awarded under the Plan, to determine the number of Shares to
be included in such Options, and to determine such other terms
and conditions of Options, including terms and conditions which
may be necessary to qualify Incentive Stock Options as "incentive
stock options" under Section 422 of the Code. The date on which
the Committee approves the grant of an Option shall be considered
the date on which such Option is granted, unless the Committee
provides for a specific date of grant which is subsequent to the
date of such approval.
5. Terms of Stock Options
Subject to Section 3 hereof, the terms of Options granted
under this Plan shall be as follows:
(a) The exercise price of each Share subject to an Option
shall be fixed by the Committee. Notwithstanding the prior
sentence, the option exercise price of an Incentive Stock
Option shall be fixed by the Committee but shall in no event
be less than 100% of the Fair Market Value of the Shares
subject to such Option.
(b) Options shall not be assignable or transferable by
the Optionee other than by will or by the laws of descent and
distribution except that the Optionee may, with the consent of
the Committee, transfer without consideration Options that do
not constitute Incentive Stock Options to the Optionee's
spouse, children or grandchildren (or to one or more trusts
for the benefit of any such family members or to one or more
partnerships in which any such family members are the only
partners).
<PAGE> 12
Exhibit 4
(c) Each Option shall expire and all rights thereunder
shall end at the expiration of such period (which shall not
be more than ten (10) years) after the date on which it was
granted as shall be fixed by the Committee, subject in all
cases to earlier expiration as provided in subsections (d) and
(e) of this Section 5.
(d) During the life of an Optionee, an Option shall be
exercisable only by such Optionee (or Optionee's permitted
assignee in the case of Options that do not constitute
Incentive Stock Options) and only prior to the end of one (1)
month after the termination of the Optionee's employment with
the Company or a Subsidiary, other than by reason of the
Optionee's death, permanent disability or retirement with the
consent of the Company or a Subsidiary as provided in
subsection (e) of this Section 5, but only if and to the
extent the Option was exercisable immediately prior to such
termination, and subject to the provisions of subsection (c)
of this Section 5. If the Optionee's employment is terminated
for cause, or the Optionee terminates his employment with the
Company, all Options granted to date by the Company to the
Optionee (including any Options that have become exercisable)
shall terminate immediately on the date of termination of
employment. Cause shall have the meaning set forth in any
employment agreement then in effect between the Optionee and
the Company or any of its Subsidiaries, or if the Optionee
does not have any employment agreement, cause shall mean (i)
if the Optionee engages in conduct which has caused, or is
reasonably likely to cause, demonstrable and serious injury to
the Company, or (ii) if the Optionee is convicted of a felony,
as evidenced by a binding and final judgment, order or decree
of a court of competent jurisdiction, which, in the opinion
of the Board , substantially impairs the Optionee's ability to
perform his or her duties to the Company.
(e) If an Optionee: (i) dies while employed by the
Company or a Subsidiary or within the period when an Option
could have otherwise been exercised by the Optionee; (ii)
terminates employment with, or has his employment terminated
by, the Company or a Subsidiary by reason of the "permanent
and total disability" (within the meaning of Section 22(e)(3)
of the Code) of such Optionee; or (iii) terminates employment
with the Company or a Subsidiary as a result of such
Optionee's retirement, provided that the Company or such
Subsidiary has consented in writing to such Optionee's
retirement, then, in each such case, such Optionee, or the
duly authorized representatives of such Optionee (or
Optionee's permitted assignee in the case of Options that do
not constitute Incentive Stock Options), shall have the right,
at any time within three (3) months after the death,
disability or retirement of the Optionee, as the case may be,
and prior to the termination of the Option pursuant to
subsection (c) of this Section 5, to exercise any Option to
the extent such Option was exercisable by the Optionee
immediately prior to such Optionee's death, disability or
retirement. In the discretion of the Committee, the three-
month period referenced in the immediately preceding sentence
may be extended for a period of up to one year.
<PAGE> 13
Exhibit 4
(f) Subject to the foregoing terms and to such additional
terms regarding the exercise of an Option as the Committee may
fix at the time of grant, an Option may be exercised in whole
at one time or in part from time to time.
(g) Options granted pursuant to the Plan shall be
evidenced by an agreement in writing setting forth the
material terms and conditions of the grant, including, but not
limited to, the number of Shares subject to options. Option
agreements covering Options need not contain similar
provisions; provided, however, that all such option agreements
shall comply with the terms of the Plan.
(h) The Committee is authorized to modify, amend or waive
any conditions or other restrictions with respect to Options,
including conditions regarding the exercise of Options.
6. Effect of Changes in Capitalization
(a) If the number of outstanding Shares is increased or
decreased or changed into or exchanged for a different number
or kind of shares or other securities of the Company by reason
of any recapitalization , reclassification , stock split ,
combination of shares, exchange of shares, stock dividend
or other distribution payable in capital stock, or other
increase or decrease in such shares effected, in each case
without receipt of consideration by the Company, a
proportionate and appropriate adjustment shall be made by the
Committee in (i) the aggregate number of Shares subject to the
Plan, (ii) the maximum number of Shares for which Options may
be granted to any Employee during any calendar year, and (iii)
the number and kind of shares for which Options are
outstanding, so that the proportionate interest of the
Optionee immediately following such event shall, to the extent
practicable, be the same as immediately prior to such event.
Any such adjustment in outstanding Options shall not change
the aggregate option price payable with respect to Shares
subject to the unexercised portion of the Options outstanding
but shall include a corresponding proportionate adjustment in
the option price per Share.
(b) Subject to Section 6.(c) hereof, if the Company shall
be the surviving corporation in any reorganization, merger,
share exchange or consolidation of the Company with one or
more other corporations or other entities , any Option
theretofore granted shall pertain to and apply to the
securities to which a holder of the number of Shares subject
to such Option would have been entitled immediately following
such reorganization, merger, share exchange or consolidation,
with a corresponding proportionate adjustment of the option
price per Share so that the aggregate option price thereafter
shall be the same as the aggregate option price of the Shares
remaining subject to the Option immediately prior to such
reorganization, merger, share exchange or consolidation.
<PAGE> 14
Exhibit 4
(c) In the event of: (i) the adoption of a plan of
reorganization, merger, share exchange or consolidation of the
Company with one or more other corporations or other entities
as a result of which the holders of the Shares as a group
would receive less than fifty percent (50%) of the voting
power of the capital stock or other interests of the surviving
or resulting corporation or entity; (ii) the adoption of a
plan of liquidation or the approval of the dissolution of the
Company; (iii) the approval by the Board of an agreement
providing for the sale or transfer (other than as a security
for obligations of the Company or any Subsidiary) of
substantially all of the assets of the Company; or (iv) the
acquisition of more than twenty percent (20%) of the
outstanding Shares by any person within the meaning of Rule
13(d)(3) under the Securities Exchange Act of 1934, as
amended, if such acquisition is not preceded by a prior
expression of approval by the Board, then, in each such case,
any Option granted hereunder shall become immediately
exercisable in full, subject to any appropriate adjustments in
the number of Shares subject to such Option and the option
price, regardless of any provision contained in the Plan or
any stock option agreement with respect thereto limiting the
exercisability of the Option for any length of time.
Notwithstanding the foregoing, if a successor corporation or
other entity as contemplated in clause (i) or (iii) of the
preceding sentence agrees to assume the outstanding Options or
to substitute substantially equivalent options, then the
outstanding Options issued hereunder shall not be immediately
exercisable, but shall remain exercisable in accordance with
the terms of the Plan and the applicable stock option
agreements.
(d) Adjustments under this Section 6 relating to Shares
or securities of the Company shall be made by the Committee,
whose determination in that respect shall be final and
conclusive. Options subject to grant or previously granted
under the Plan at the time of any event described in this
Section 6 shall be subject to only such adjustments as shall be
necessary to maintain the proportionate interest of the options
and preserve, without exceeding, the value of such options. No
fractional Shares or units of other securities shall be issued
pursuant to any such adjustment, and any fractions resulting
from any such adjustment shall be eliminated in each case by
rounding upward to the nearest whole Share or unit.
(e) The grant of an Option pursuant to the Plan shall not
affect or limit in any way the right or power of the Company to
make adjustments, reclassifications, reorganizations or changes
of its capital or business structure or to merge, consolidate,
dissolve or liquidate, or to sell or transfer all or any part of
its business or assets.
<PAGE> 15
Exhibit 4
7. Delivery and Payment for Shares; Replacement Options
(a) No Shares shall be delivered upon the exercise of an
Option until the option price for the Shares acquired has been
paid in full. No Shares shall be issued or transferred under
the Plan unless and until all legal requirements applicable to
the issuance or transfer of such Shares have been complied
with to the satisfaction of the Committee and adequate
provision has been made by the Optionee for satisfying any
applicable federal, state or local income or other taxes
incurred by reason of the exercise of the Option. Any Shares
issued by the Company to an Optionee upon exercise of an
Option may be made only in strict compliance with and in
accordance with applicable state and federal securities laws.
(b) Payment of the option price for the Shares purchased
pursuant to the exercise of an Option and of any applicable
withholding taxes shall be made, as determined by the
Committee and set forth in the option agreement pertaining to
such Option: (i) in cash or by check payable to the order of
the Company; (ii) through the tender to the Company of Shares,
which Shares shall be valued, for purposes of determining the
extent to which the option price has been paid thereby, at
their Fair Market Value on the date of exercise; or (iii) by a
combination of the methods described in (a) and (b) hereof;
provided, however, that the Committee may in its discretion
impose and set forth in the option agreement pertaining to an
Option such limitations or prohibitions on the use of Shares
to exercise Options as it deems appropriate. The Committee
also may authorize payment in accordance with a cashless
exercise program under which, if so instructed by the
Optionee, Shares may be issued directly to the Optionee's
broker upon receipt of the option price in cash from the
broker.
(c) To the extent that the payment of the exercise price
for the Shares purchased pursuant to the exercise of an Option
is made with Shares as provided in Section 7.(b) hereof, then,
at the discretion of the Committee, the Optionee may be
granted a replacement Option under the Plan to purchase a
number of Shares equal to the number of Shares tendered as
permitted in Section 7.(b) hereof, with an exercise price per
Share equal to the Fair Market Value on the date of grant of
such replacement Option and with a term extending to the
expiration date of the original Option.
<PAGE> 16
8. No Continuation of Employment and Disclaimer of Rights
No provision in the Plan or in any Option granted or option
agreement entered into pursuant to the Plan shall be construed to
confer upon any individual the right to remain a director or in
the employ of either the Company or any Subsidiary, or to
interfere in any way with the right and authority of the Company
or any Subsidiary either to increase or decrease the compensation
of any individual at any time, or to terminate any employment or
other relationship between any individual and the Company or any
Subsidiary. The Plan shall in no way be interpreted to require
the Company to transfer any amounts to a third party trustee or
otherwise hold any amounts in trust or escrow for payment to any
Optionee or beneficiary under the terms of the Plan. An Optionee
shall have none of the rights of a shareholder of the Company
until and to the extent all or some of the Shares covered by an
Option are fully paid and issued to such Optionee.
9. Administration
(a) Subject to the provisions of subsection (b) of this
Section 9, the Plan shall be administered by the Committee
which shall interpret the Plan and make all other
determinations necessary or advisable for its administration,
including such rules and regulations and procedures as it
deems appropriate. The Committee shall consist of not fewer
than two members of the Board each of whom shall qualify (at
the time of appointment to the Committee and during all
periods of service on the Committee) in all respects as a
"non-employee director" as defined in Rule 16b-3 and as an
"outside director" as defined in Section 162(m)of the Code and
regulations thereunder. If at any time the Committee shall not
be in existence, the Board shall administer the Plan, and all
references to the Committee herein shall include the Board.
The deduction limits of Section 162(m) of the Code and the
regulations thereunder do not apply to the Company until such
time, if any, as any class of the Company's common equity
securities is registered under Section 12 of the Securities
and Exchange Act of 1934, as amended, or the Company otherwise
meets the definition of a "publicly held corporation" under
Treasury Regulation 1.162-27(c) or any successor provision.
Upon becoming a publicly held corporation, the deduction
limits of Section 162(m) of the Code and the regulations
thereunder shall not apply to compensation payable under this
Plan until the expiration of the reliance period described
in Treasury Regulation 1.162-27(f) or any successor
regulation. Subject to the provisions of subsection (b) of
this Section 9, in the event of a disagreement as to the
interpretation of the Plan or any amendment hereto or any
rule, regulation or procedure hereunder or as to any right or
obligation arising from or related to the Plan, the decision
of the Committee shall be final and binding upon all persons
in interest, including the Company, the Optionee and the
Company's shareholders.
<PAGE> 17
Exhibit 4
(b) Notwithstanding any provision of the Plan to the
contrary, any determination or interpretation to be made by
the Committee with regard to any question arising under the
Plan or any option agreement entered into hereunder may be
made by the Board (excluding any Optionee whose Options or the
grant to whom is at issue) and shall be final and binding upon
all persons in interest, including the Company, the Optionee
and the Company's shareholders.
(c) No member of the Committee or the Board shall be
liable for any action taken or decision made, or any failure
to take any action, in good faith with respect to the Plan or
any Option granted or option agreement entered into hereunder.
10. No Obligation to Reserve or Retain Shares
The Board adopted, as of the Effective Date, a resolution
initially reserving authorized but unissued Shares for the Plan.
The Company will be under no further obligation to reserve, or to
retain in its treasury, any particular number of Shares in
connection with its obligations hereunder.
11. Amendment of Plan
The Board, without further action by the shareholders, may
amend this Plan from time to time as it deems desirable and shall
make any amendments which may be required so that Options
intended to be Incentive Stock Options shall at all times
continue to be Incentive Stock Options for purpose of the Code;
provided, however, that the Board or Committee may condition any
amendment or modification on the approval of stockholders of the
Company if such approval is necessary or deemed advisable with
respect to tax, securities or other applicable laws, policies or
regulations.
12. Termination of Plan
This Plan shall terminate ten (10) years from the Effective
Date. The Board may, in its discretion, suspend or terminate the
Plan at any time prior to such date, but such termination or
suspension shall not adversely affect any right or obligation
with respect to any outstanding Option.
13. Effective Date
The Plan shall become effective on the Effective Date and
Options hereunder may be granted at any time on or after that
date. If the shareholders of the Company fail to approve the
Plan prior to, or within one year after, the Effective Date, any
Incentive Stock Option granted hereunder shall be automatically
converted to non-qualified stock options without any further act.
<PAGE> 18
Exhibit 5
Salley Bowes Harwardt
Barristers and Solicitors
Suite 1750 - 1185 West Georgia Street
Vancouver, B.C., Canada
V6E 4E6
Telephone: (604) 688-0788
Fax: (604) 688-0778
E-mail: [email protected]
June 29, 1999
Nicholas Financial, Inc.
2454 McMullen Booth Road
Clearwater, Florida 33759
Ladies & Gentlemen:
We have acted as counsel for Nicholas Financial, Inc., a company
incorporated under the laws of British Columbia (the "Company"),
in connection with the review of a Form S-8 Registration
Statement (the "Registration Statement") to be filed by the
Company with the Securities and Exchange Commission under the
Securities Act of 1933, as amended (the "Securities Act"),
relating to 350,000 shares of the Company's Common Shares without
par value (the "Common Stock"), which may be issued or acquired
pursuant to the Nicholas Financial, Inc. Employee Stock Option
Plan (the "Plan").
In this regard, we have examined: (a) the Plan; (b) the Altered
Memorandum and Articles of the Company; (c) resolutions of the
Company's Board of Directors relating to the Plan; (d) applicable
certificates of public officials; and (e) such other documents
and records as we have deemed necessary to enable us to render
this opinion.
Based upon the foregoing, we are of the opinion that:
1. The Company is a corporation in good standing under the laws
of the Province of British Columbia.
2. The shares of Common Stock, when issued pursuant to the
terms and conditions of the Plan, and as contemplated in
Registration Statement, will be validly issued, fully paid
and nonassessable.
We consent to the use of this opinion as an exhibit to the
Registration Statement. In giving this consent, we do not admit
that we are "experts" within the meaning of Section 11 of the
Securities Act or within the category of persons whose consent is
required by Section 7 of the Securities Act.
This opinion is limited to the laws of the Province of British
Columbia and the federal laws of Canada applicable therein, and
we express no opinion with respect to the laws of any other
province, state or jurisdiction.
Yours very truly,
/s/Salley Bowes Harwardt
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<PAGE> 19
Exhibit 23.1
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration
Statement (Form S-8) pertaining to the Nicholas Financial, Inc.
Employee Stock Option Plan of Nicholas Financial, Inc. of our
report dated May 7, 1999, with respect to the consolidated
financial statements of Nicholas Financial, Inc. included in its
Annual Report (Form 10-KSB) for the year ended March 31, 1999,
filed with the Securities and Exchange Commission.
/s/ Ernst & Young LLP
-----------------------
Tampa, Florida
June 25, 1999
