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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. ________________)*
MOSSIMO, INC.
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(NAME OF ISSUER)
COMMON STOCK
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(TITLE OF CLASS OF SECURITIES)
619696 10 7
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(CUSIP NUMBER)
EDWIN H. LEWIS
AND
MOSSIMO GIANNULLI
C/O MOSSIMO, INC.
2450 WHITE ROAD, 2ND FLOOR
IRVINE, CALIFORNIA 92614
TEL. NO.: (949) 797-0200
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(NAME, ADDRESS AND TELEPHONE NUMBER OF PERSON AUTHORIZED
TO RECEIVE NOTICES AND COMMUNICATIONS)
WITH A COPY TO:
DAVID A. KRINSKY, ESQ. CARY K. HYDEN, ESQ.
O'MELVENY & MYERS LLP LATHAM & WATKINS
610 NEWPORT CENTER DRIVE 650 TOWN CENTER DRIVE
SUITE 1700 TWENTIETH FLOOR
NEWPORT BEACH, CALIFORNIA 92660 COSTA MESA, CALIFORNIA 92626-1925
NOVEMBER 30, 1998
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(DATE OF EVENT WHICH REQUIRES FILING OF THIS STATEMENT)
If the filing person has previously filed a statement on Schedule 13G to
report the acquisition which is the subject of this Schedule 13D, and is
filing this statement because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check
the following box: [ ]
Note: Schedules filed in paper format shall include a signed original and
five copies of the schedule, including all exhibits. See Rule 13d-7 for other
parties to whom copies are to be sent.
*The remainder of this cover page shall be filled out for a reporting
person's initial filing on this form with respect to the subject of class of
securities, and for any subsequent amendment containing information which
would alter disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities Exchange
Act of 1934 ("Act") or otherwise subject to the liabilities of that section
of the Act but shall be subject to all other provisions of the Act (however,
see the Notes).
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CUSIP NO. 619696 10 7
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(1) NAME OF REPORTING PERSON
Edwin H. Lewis
I.R.S. IDENTIFICATION NO. OF ABOVE PERSON (ENTITIES ONLY)
Inapplicable.
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(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [ x ]
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(3) SEC USE ONLY
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(4) SOURCE OF FUNDS
OO
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(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) [ ]
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(6) CITIZENSHIP OR PLACE OF ORGANIZATION
U.S.A.
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(7) SOLE VOTING POWER
5,186,111
NUMBER OF -------------------------------------------
SHARES (8) SHARED VOTING POWER
BENEFICIALLY -0- See Items 4 and 5
OWNED BY -------------------------------------------
EACH (9) SOLE DISPOSITIVE POWER
REPORTING 5,186,111
PERSON -------------------------------------------
WITH (10) SHARED DISPOSITIVE POWER
-0- See Items 4 and 5
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(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
5,186,111
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(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES See Items 4 and 5 [X]
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(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
34.5%
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(14) TYPE OF REPORTING PERSON
IN
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CUSIP NO. 619696 10 7
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(1) NAME OF REPORTING PERSON
Mossimo Giannulli
I.R.S. IDENTIFICATION NO. OF ABOVE PERSON (ENTITIES ONLY)
Inapplicable.
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(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [ x ]
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(3) SEC USE ONLY
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(4) SOURCE OF FUNDS
OO
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(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) [ ]
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(6) CITIZENSHIP OR PLACE OF ORGANIZATION
U.S.A.
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(7) SOLE VOTING POWER
5,186,111
NUMBER OF -------------------------------------------
SHARES (8) SHARED VOTING POWER
BENEFICIALLY -0- See Items 4 and 5
OWNED BY -------------------------------------------
EACH (9) SOLE DISPOSITIVE POWER
REPORTING 4,186,111 See Items 4 and 5
PERSON -------------------------------------------
WITH (10) SHARED DISPOSITIVE POWER
-0- See Items 4 and 5
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(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
5,186,111
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(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES See Items 4 and 5 [X]
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(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
34.5%
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(14) TYPE OF REPORTING PERSON
IN
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3
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ITEM 1. SECURITY AND ISSUER
This statement relates to the Common Stock (the "Common Stock") of
Mossimo, Inc., a Delaware corporation (the "Company"), having its principal
executive offices at 2450 White Road, 2nd Floor, Irvine, California 92614.
ITEM 2. IDENTITY AND BACKGROUND
(a) This Schedule 13D is filed on behalf of Mossimo Giannulli
("Giannulli") and Edwin H. Lewis ("Lewis" and, together with
Giannulli, the "Reporting Persons").
(b) The business address of each Reporting Person is c/o Mossimo,
Inc., 2450 White Road, 2nd Floor, Irvine, California 92614.
(c) The present principal occupation of Giannulli is Chairman of the
Board of the Company and of Lewis is Chief Executive Officer,
President and Director of the Company.
(d) Neither of the Reporting Persons has, during the last five years,
been convicted in a criminal proceeding (excluding traffic
violations or similar misdemeanors).
(e) Neither of the Reporting Persons has, during the last five years,
been a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction as a result of
which the Reporting Person was or is subject to a judgment,
decree or final order enjoining future violations of, or
prohibiting or mandating activities subject to, federal or state
securities laws, or finding any violation with respect to such
laws.
(f) Each of the Reporting Persons is a citizen of the United States
of America.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
This Schedule 13D is filed by Lewis and Giannulli to report their
execution of and agreement to be bound by a Stockholders Agreement dated
November 30, 1998 among Lewis, the Company and Giannulli, which is described
in Item 4 set forth below. As a result of the execution of the Stockholders
Agreement, Lewis and Giannulli may be deemed to constitute a group for
purposes of Section 13(d) of the Securities Exchange Act of 1934 , as amended.
This Schedule 13D is also filed by Giannulli to report a decrease
in his beneficial ownership of shares of Common Stock, as a result of his
agreement to vote certain shares as directed by Lewis and to contribute these
shares to the Company, as described in Item 4 set forth below. Giannulli's
beneficial ownership decreased from 10,372,222 shares, or 69.1% of the
outstanding shares of Common Stock, to 5,186,111 shares or 34.5% of the
outstanding shares of
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Common Stock. This Schedule 13D amends the Schedule 13G previously filed by
Giannulli on February 13, 1997.
This Schedule 13D is also filed by Lewis to report his acquisition of
beneficial ownership of 5,186,111 shares of Common Stock of the Company,
representing 34.5% of the outstanding Common Stock. These shares are represented
by immediately exercisable options granted to Lewis by the Company. These
options may be exercised through a cash payment or delivery of shares of Common
Stock that have been owned by Lewis for at least six months. Lewis has the right
immediately to direct the voting of these shares, as more fully discussed in
Item 4 below.
ITEM 4. PURPOSE OF TRANSACTION
On November 30, 1998, the Board of Directors of the Company
approved the appointment of Lewis as Chief Executive Officer ("CEO"),
President and Director of the Company, effective on December 1, 1998.
On November 30, 1998, Lewis accepted his appointment as CEO,
President and Director of the Company, effective on December 1, 1998. In
consideration of the foregoing, the Company and Lewis entered into (i) a
Nonqualified Stock Option Agreement dated as of November 30, 1998, pursuant
to which the Company granted Lewis an immediately exercisable option to
purchase up to 5,152,778 shares of the Company's Common Stock, par value
$.001 per share (the "Common Stock"), at a purchase price of $3.00 per share
(I.E., the fair market value of the Common Stock on the date of grant); (ii)
an Incentive Stock Option Agreement dated as of November 30, 1998, pursuant
to which the Company granted Lewis an immediately exercisable option to
purchase up to 33,333 shares of Common Stock at a purchase price of $3.00 per
share; (iii) a Nonqualified Performance Stock Option Agreement dated as of
November 30, 1998, pursuant to which the Company granted Lewis an option to
purchase up to 966,667 shares of Common Stock at a purchase price of $3.00
per share, with such options vesting on November 30, 2005, subject to
accelerated vesting upon the happening of certain events relating in part to
the Common Stock price; and (iv) a Performance Incentive Stock Option
Agreement dated as of November 30, 1998, pursuant to which the Company
granted Lewis an option to purchase 33,333 shares of Common Stock at a
purchase price of $3.00 per share, with such options vesting on November 30,
2005, subject to accelerated vesting upon the happening of certain events
relating in part to the Common Stock price (together, the "Stock Option
Agreements"). As a result of the option grants under the Stock Option
Agreements, Lewis is deemed to be the beneficial owner (as defined in Rule
13d-3(d)(1) of the Securities Exchange Act of 1934, as amended) of 5,186,111
shares of Common Stock, representing 34.5% of the outstanding shares of
Common Stock.
In connection with the execution of the Stock Option Agreements,
the Company and Giannulli entered into (i) a Contribution Agreement dated as
of November 30, 1998, pursuant to which Giannulli has agreed to contribute to
the Company a number of shares of Common Stock equal to the aggregate number
of shares of Common Stock to be issued by the Company upon Lewis' exercise of
the options contemplated by the Stock Option Agreements
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and (ii) an Escrow Agreement dated as of November 30, 1998, pursuant to which
Giannulli agreed to place 6,186,111 shares of Common Stock in an escrow
account pending Lewis' exercise of the options contemplated by the Stock
Option Agreements (together, the "Funding Agreements"). Giannulli entered
into the Funding Agreements for no consideration payable by the Company.
The options contemplated by the Nonqualified Stock Option Agreement
and the Nonqualified Performance Stock Option Agreement will expire upon the
earlier of (i) November 30, 2018 and (ii) one year from the date of the death
of Lewis. The options contemplated by the Incentive Stock Option Agreement
and the Performance Incentive Stock Option Agreement will expire upon the
earlier of (i) November 30, 2008 and (ii) one year from the date of the death
of Lewis. Pursuant to the terms of the Escrow Agreement, if any options
contemplated by the Stock Option Agreements expire, shares of Common Stock
underlying the options will revert back to Giannulli. The Escrow Agreement
provides that (i) dividends (other than stock dividends) made in respect of
the Lewis Escrowed Shares (defined as the number of shares of Common Stock
equal to (A) the number of escrowed shares of Common Stock underlying the
Nonqualified Stock Option Agreement and the Incentive Stock Option Agreement,
less (B) the number of shares of Common Stock issued to Lewis upon exercise
of the options governed by the Nonqualified Performance Stock Option
Agreement and the Performance Incentive Stock Option Agreement, and
subsequently transferred to a third party ("Disqualified Shares")) shall be
released to Lewis and (ii) dividends (other than stock dividends) made in
respect of the Giannulli Escrowed Shares (defined as the number of shares of
Common Stock equal to the total number of escrowed shares, less the Lewis
Escrowed Shares) shall be released to Giannulli.
On November 30, 1998, Lewis and Giannulli entered into a
Stockholders Agreement which provides for certain rights and restrictions
with respect to Lewis' and Giannulli's ownership interests in the Company and
certain covenants relating to the corporate governance of the Company. The
key provisions of the Stockholders Agreement are as follows:
BOARD PARTICIPATION. The Board of Directors of the Company, which
currently consists of four Directors (Giannulli, Lewis, John Stafford and
Robert Martini), will be re-structured to consist of five Directors. The
fifth Director will be designated by the Nominating Committee of the Board,
which is comprised of Giannulli and Lewis. Each of Giannulli and Lewis will
be entitled unilaterally to nominate for election one member of the Board
until his death or such time as he does not own at least 10% of the
outstanding Common Stock (a "Termination Event"). Accordingly, until a
Termination Event, at each election of Directors in which the term of a
Director nominated by Lewis or Giannulli expires, Lewis or Giannulli, as
applicable, will be entitled to nominate one Director. Until a Termination
Event, Giannulli and Lewis will continue to be the sole members of the
Nominating Committee of the Board and, in such capacity, they will jointly
nominate the other members of the Board. In the event Giannulli and Lewis
cannot agree on joint nominees, such joint nominations will be made by the
entire Board.
VOTING RIGHTS. Each of Giannulli and Lewis will vote his shares of
Common Stock in his sole and absolute discretion, except that, subject to
certain termination events, (i)
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Lewis will vote a number of shares of Common Stock equal to the number of
Lewis Escrowed Shares, (ii) Giannulli will vote a number of shares of Common
Stock equal to the number of Giannulli Escrowed Shares, (iii) Lewis will vote
the number of shares of Common Stock issued upon exercise of the Nonqualified
Performance Incentive Stock Option Agreement less the number of Disqualified
Shares in accordance with Giannulli's instructions; and (iv) each of
Giannulli and Lewis will vote one-half of the shares of Common Stock he
acquires after November 30, 1998 in accordance with the other's instructions.
The intent of these provisions is to equalize the voting power of Giannulli
and Lewis except to the extent that either one of them transfers his shares
to a third party. Therefore, after giving effect to these provisions, subject
to certain termination events, until Giannulli or Lewis transfers his shares
to a third party, each of Giannulli and Lewis will have the right to vote
5,186,111 shares, or 34.5% of the outstanding shares of Common Stock. In the
event of the death or mental disability of either Giannulli or Lewis, each
Successor (defined as an heir of the deceased party or a transferee of an
heir receiving greater than 5% of the outstanding voting securities of the
Company) shall vote the deceased party's voting securities in accordance with
the directions of whichever of Giannulli or Lewis is the survivor, and, in
the absence of such instructions, shall not vote such securities. Giannulli
and Lewis have also agreed to vote in favor of each other's Board nominees,
and to vote in favor of the Mossimo, Inc. Stock Option Plan for Lewis at the
next annual meeting of stockholders.
STANDSTILL PROVISIONS. Until such time as either Giannulli or Lewis
dies or does not beneficially own at least 10% of the outstanding shares of
Common Stock, or until certain other termination events occur (a "Standstill
Termination Event"), neither Giannulli nor Lewis will be permitted, without
the consent of the other, to seek representation on the Board, other than as
described in the Stockholders Agreement, or to form a group with other
stockholders of the Company for the purpose of acquiring, holding, voting or
disposing of voting securities of the Company.
RESTRICTIONS ON TRANSFER. Until the earlier of a Standstill
Termination Event or November 30, 2000, neither Giannulli nor Lewis will be
permitted to transfer his shares to a third party, subject to certain
exceptions, including sales pursuant to Rule 144 under the Securities Act of
1933, as amended. Thereafter, neither party may transfer more than 5% of the
outstanding shares of Common Stock to a competitor of the Company without the
consent of 60% of the Board of Directors of the Company. Giannulli is also
prohibited from transferring the 6,186,111 shares of Common Stock subject to
the Escrow Agreement except to the Company in accordance with the
Contribution Agreement.
RIGHT OF FIRST REFUSAL. Each of Giannulli and Lewis will have a
right of first refusal to purchase the other's shares in the event of a
proposed sale of such shares to a third party, subject to certain exceptions.
To exercise this right, Giannulli or Lewis must purchase the shares on the
same terms offered by the third party.
RIGHT OF INCLUSION. If either Giannulli or Lewis (the "Selling
Party") proposes to sell shares representing more than 5% of the outstanding
Common Stock to a third party, the Selling Party must allow the other party
the opportunity to sell one-half of the shares in the
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transaction. For example, if a third party offers to purchase two million
shares of Common Stock from Giannulli, Giannulli must cause the third party
to offer to purchase one million shares of Common Stock from each of
Giannulli and Lewis.
Other than as described in the preceding paragraphs or as incident
to their positions in the Company, including their position on the Nominating
Committee and the Company's need to identify a qualified candidate to fill
the current vacancy on the Board, the Reporting Persons have no present plans
or proposals that relate to or would result in any of the actions described
in subparagraphs (a) through (j) of Item 4 of the Schedule 13D.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER
(a) Giannulli beneficially owns 5,186,111 shares of Common Stock,
which represent approximately 34.5% of the outstanding shares of
Common Stock.
Lewis beneficially owns 5,186,111 shares of Common Stock,
representing approximately 34.5% of the outstanding shares of
Common Stock.
The foregoing report of Common Stock excludes shares of Common
Stock that each of the Reporting Persons may be deemed to
beneficially own as a result of the terms of the Stockholders
Agreement. Lewis' and Giannulli's agreement to vote their
respective shares of Common Stock for the other's Board nominee
may be deemed to create voting power that is shared by the
Reporting Persons. As a result, each of Lewis and Giannulli would
be deemed to beneficially own and have shared voting power as to
10,372,222 shares or 69.1% of the outstanding shares of Common
Stock. Each Reporting Person, however, disclaims beneficial
ownership of any shares of Common Stock other than the 5,186,111
shares of Common Stock which he has the sole power to vote.
(b) Pursuant to the terms of the Stockholders Agreement, until
certain termination events have occurred, Giannulli has the sole
power to vote or to direct the vote of 5,186,111 shares and the
sole power to dispose or to direct the disposition of 4,186,111
shares.
Pursuant to the terms of the Stockholders Agreement, until
certain termination events have occurred, Lewis has the sole
power to vote or to direct the vote of 5,186,111 shares and the
sole power to dispose or to direct the disposition of 5,186,111
shares.
The foregoing report of Common Stock excludes shares of Common
Stock that each of the Reporting Persons may be deemed to
beneficially own as a result of the terms of the Stockholders
Agreement. Lewis' and Giannulli's agreement to vote their
respective shares of Common Stock for the other's Board nominee
may be deemed to create voting power that is shared by
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the Reporting Persons. As a result, each of Lewis and Giannulli
would be deemed to beneficially own and have shared voting power
as to 10,372,222 shares or 69.1% of the outstanding shares of
Common Stock. Each Reporting Person, however, disclaims
beneficial ownership of the shares of Common Stock beneficially
owned by the other Reporting Person.
(c) Neither Reporting Person has effected any transactions in any
shares of Common Stock of the Company during the past 60 days.
(d) Other than the Reporting Persons, no person has the right to
receive or the power to direct the receipt of dividends from, or
the proceeds from the sale of, the shares of Common Stock
beneficially owned by the Reporting Persons.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT
TO SECURITIES OF THE ISSUER
Reference is hereby made to the discussion of the material terms of
the Stock Option Agreements, Contribution Agreement, Escrow Agreement and
Stockholders Agreement in Item 4.
The Company has also agreed to enter into registration rights
agreements with Lewis and Giannulli with respect to the shares of Common
Stock owned by Giannulli and the shares of Common Stock underlying the Stock
Option Agreements.
The foregoing summary of the transactions and agreements described
above does not purport to be complete and is qualified in its entirety by
reference to the exhibits which are incorporated by reference herein.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS
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Exhibit 1 Stockholders Agreement dated as of November 30, 1998, between
Mossimo Giannulli, Edwin H. Lewis and Mossimo, Inc.*
Exhibit 2 The Mossimo, Inc. Stock Option Plan for Edwin Lewis.*
Exhibit 3 Nonqualified Stock Option Agreement dated as of November 30,
1998,* between Mossimo, Inc. and Edwin H. Lewis.
Exhibit 4 Incentive Stock Option Agreement dated as of November 30,
1998,* between Mossimo, Inc. and Edwin H. Lewis.
Exhibit 5 Nonqualified Performance Stock Option Agreement dated as of
November 30, 1998, between Mossimo, Inc. and Edwin H. Lewis.*
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Exhibit 6 Performance Incentive Stock Option Agreement dated as of
November 30, 1998, between Mossimo, Inc. and Edwin H. Lewis.*
Exhibit 7 Contribution Agreement dated as of November 30, 1998, between
Mossimo, Inc. and Mossimo Giannulli.*
Exhibit 8 Form of Escrow Agreement dated as of November 30, 1998, between
Mossimo, Inc., Mossimo Giannulli, and the custodian thereunder.*
Exhibit 9 Joint Filing Agreement, dated December 9, 1998.
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* Incorporated by reference to the Company's Form 8-K filed with the
Securities and Exchange Commission on December 8, 1998.
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SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief,
I certify that this statement is true, complete and correct.
Dated: December 9, 1998
/s/ MOSSIMO GIANNULLI
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Mossimo Giannulli
/s/ EDWIN H. LEWIS
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Edwin H. Lewis
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EXHIBIT 9
JOINT FILING AGREEMENT
The undersigned agree that the foregoing statement on Schedule 13D
is being filed with the Commission on behalf of each of the undersigned
pursuant to Rule 13d-1(k)(1).
Dated: December 9, 1998 /s/ MOSSIMO GIANNULLI
----------------------------------
Mossimo Giannulli
/s/ EDWIN H. LEWIS
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Edwin H. Lewis
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