As filed with the Securities and Exchange Commission on January 8, 1998
Registration No. ________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
---------------
FORM S-8
REGISTRATION STATEMENT
Under
The Securities Act of 1933
---------------
NITCHES, INC.
(Exact name of issuer as specified in its charter)
California 95-2848021
(State of Incorporation) (IRS Employer Identification No.)
---------------
NITCHES, INC. EXECUTIVE OPTION PLAN
(Full title of the plan)
Steven P. Wyandt, President
NITCHES, INC.
10280 Camino Santa Fe
San Diego, California 92121
(Name and address of agent for service)
(619) 625-2633
(Telephone number including area code of agent for service)
---------------
Copies To:
James A. Mercer III, Esq.
Luce, Forward, Hamilton & Scripps LLP
600 West Broadway, 26th Floor
San Diego, California 92101
---------------
Approximate Date of Commencement of Proposed Sale: January 8, 1998.
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[CONTINUATION OF COVER PAGE]
CALCULATION OF REGISTRATION FEE
Title of Amount to Proposed Proposed Amount of
securities be regis maximum maximum registra
to be tered(1) aggregate aggregate tion fee(3)
registered offering offering
price(2) price(2)
- -------------------------------------------------------------------------------
Common 200,000 $6.28 $314,062.50 $92.65
Stock (no
par value)
- -------------------------------------------------------------------------------
(1) The number of shares of Common Stock is an aggregate number which
includes 150,000 shares of Common Stock which were previously
registered on February 1, 1990(Registration No. 33- 33293).
(2) Determined by using $6.28125 which was the average of the bid and ask
price of the Registrant's Common Stock in the NASDAQ National Market
January 6, l998, solely for the purpose of calculating the registration
fee.
(3) The amount of registration fee does not include the registration fees
which were previously paid on the shares referred to in footnote (1).
<PAGE>
PROSPECTUS
NITCHES, INC.
200,000 shares
Common Stock
(No Par Value)
NITCHES, INC.
EXECUTIVE OPTION PLAN
--------------------
This Prospectus relates to shares of the common stock, no par value, (the
"Stock") of Nitches, Inc., a California corporation (the "Company"), to be
offered to eligible directors, officers and employees of the Company pursuant to
the Company's Executive Option Plan, as amended (the "Plan").
--------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION
OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
---------------------
No person is authorized to give any information or to make any
representations other than those contained in this Prospectus and, if given or
made, such information or representations must not be relied upon as having been
authorized by Nitches, Inc. This Prospectus does not constitute an offer to sell
or solicitation of an offer to buy any securities other than those to which it
relates or an offer or solicitation by anyone in any state in which such offer
or solicitation is not authorized or in which the person making such offer or
solicitation is not qualified to do so or to anyone to whom it is unlawful to
make such offer or solicitation. Neither the delivery of this Prospectus nor any
sale made hereunder shall, under any circumstances, create any implication that
there has been no change in the affairs of the Company since the date hereof.
- --------------------
The date of this Prospectus is January 8, 1998.
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The Company is subject to the information requirements of the
Securities Exchange Act of 1934 (the "Exchange Act") and, as such, is required
to file periodic reports and other information with the Securities and Exchange
Commission (the "Commission"). Reports, proxy statements and other information
concerning the Company may be inspected and copied at the Commission's Office of
Public Reference, Room 1024, Judiciary Plaza, 450 Fifth Street, N.W.,
Washington, D.C. 2O549, as well as the following regional offices of the
Commission: 7 World Trade Center, New York, New York 10048; and at the Northwest
Atrium Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661. The
Company is an electronic filer, and the Commission maintains a Web site that
contains information regarding the Company. The address of such Web site is
http://www.sec.gov. Copies of such material can also be obtained at prescribed
rates from the Public Reference Section of the Commission at its principal
office at 450 Fifth Street, N.W., Washington, D.C. 20549.
The Stock is quoted on the NASDAQ National Market Under the symbol
"NICH".
Any employee who receives this Prospectus may request, orally or in
writing copy of the Company's Annual Report to its shareholders for the
Company's last fiscal year and any of the information that has been incorporated
by reference into this Prospectus. The Company will promptly furnish such
information, without charge, to the employee. Requests should be mailed to the
Company's principal executive office, Nitches, Inc., 10280 Camino Santa Fe, San
Diego, California, 92121 Attn: Secretary; telephone number (619) 625-2633.
All references to the "Plan" in this Prospectus shall mean the
Company's Executive Option Plan, as originally adopted by the Company's Board of
Directors on October 3, 1989 and approved by the Company's shareholders on
January 25, 1990, as amended by the Company's Board of Directors on October 16,
1995 and approved by the Company's shareholders on December 20, 1995, and as
amended by the Company's Board of Directors on August 24, 1996.
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TABLE OF CONTENTS
General Information About the Company.........................................1
General Nature and Purpose of the Plan........................................1
Amendment and Termination of the Plan.........................................1
Federal Tax Consequences of the Plans.........................................2
Securities to be Offered......................................................3
Participation in the Plan.....................................................3
Restrictions on Sale of Shares................................................3
Terms of the Plan.............................................................4
Adjustment of the Number of Shares............................................4
Merger or Consolidation; Dissolution..........................................4
Securities Law Compliance.....................................................5
Exercise of Stock Options.....................................................5
Assignment of Interest........................................................5
Administration of the Plan....................................................5
Certain Information for Future Years..........................................5
Incorporation of Certain Documents by Reference...............................6
Experts.......................................................................6
Indemnification of Directors and Officers.....................................7
Administration................................................................8
Eligibility and Participation.................................................8
Outstanding Options...........................................................8
Miscellaneous.................................................................8
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General Information About the Company
Nitches, Inc., a California corporation (the "Company"), is an importer
and wholesale distributor of women's sportswear manufactured to its
specifications in foreign countries. The Company was organized in 1971 and has
been engaged in its present business since 1973. Clothing imported by the
Company is distributed in the United States under various Company brand labels
and under private retailer labels.
For additional information concerning the Company see the documents
incorporated by reference herein.
General Nature and Purpose of the Plan
The Company's Board of Directors adopted an Executive Option Plan on
October 3, 1989 (the "Plan") and the shareholders approved the Plan on January
25, 1990. On October 16, 1995, the Company's Board of Directors amended the Plan
to permit directors to participate and to increase the number of shares of the
Company's Common Stock (the "Stock") for which options may be granted under the
Plan from 150,000 to 200,000, which amendment was approved by the shareholders
on December 20, 1995. On August 24, 1996, the Company's Board of Directors
amended the plan to permit cashless exercises and to make conforming changes to
changes in the Commissions rules regarding insider trading and reporting
obligations. The number of shares of stock for which options may be granted
under the Plan is 200,000.
The main purpose of the Plan is to provide an incentive to directors,
key executives and employees of the Company to maximize their efforts and skills
towards the advancement and betterment of the Company by enabling them to
increase their share of ownership, and thereby participate to a greater extent
in the increased value, if any, which may result in the price of the Company's
shares due to such efforts.
The Plan is not qualified under Section 401(a) of the Internal Revenue
Code of 1986 (the "Code"), and is not subject to the Employee Retirement Income
Security Act of 1974.
Amendment and Termination of the Plan
The Plan will terminate as determined by the Board of Directors. Any
such termination will not affect options already granted and such options will
remain in effect as if the Plan had not been terminated.
The Board of Directors may amend the Plan from time to time in
such respects as the Board may deem advisable. However, the
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consent of the holders of a majority of the outstanding Stock is required for
any amendment of the Plan which would: materially increase the benefits accruing
to eligible participants; (ii) materially increase the number of shares of Stock
issuable; or (iii) materially modify the requirements as to eligibility.
Federal Tax Consequences of the Plans
A participant who receives an option under the Plan (an "optionee")
will not recognize taxable income upon the grant of that option. An optionee
will recognize ordinary income upon the exercise of an option in an amount equal
to the excess of the fair market value of the shares at the time of exercise
over the exercise price.
In the event an optionee is an officer or director of the Company or a
beneficial owner of more than 10% of any class of equity securities of the
Company, the recognition of income will be deferred until the earlier of (i) six
months after the exercise, or (ii) the earliest date on which the sale of such
shares at a profit would not subject the optionee to suit under Section 16(b) of
the Exchange Act. Such optionee may, nevertheless, elect under Section 83 of the
Code within 30 days of exercise to recognize ordinary income in the amount by
which the fair market value of such shares on the date of exercise exceeds the
option price. Any gain realized which is attributable to appreciation in the
value of such shares after the exercise date will be considered capital gain
rather than ordinary income. Any loss realized which is attributable to
depreciation in the value of such shares after the exercise date will be
considered a capital loss.
The ordinary income recognized by an employee with respect to the
exercise of an option will be subject to both wage withholding and employment
taxes. An optionee's tax basis in the shares received on exercise of such an
option will be equal to the amount of any cash paid by the optionee on exercise,
plus the amount of ordinary income recognized as a result of the receipt of such
shares. The holding period for such shares would begin on the date of exercise
or, in the case of an officer, director or beneficial owner of more than 10% of
any class of equity securities of the Company who does not make a Section 83
election, on the earlier of (i) six months after the exercise, or (ii) the
earliest date on which such person may sell such shares at a profit without
being subject to suit under Section 16(b) of the Exchange Act. The holding
period for shares subject to a Section 83 election would begin just after the
date of exercise. A deduction for Federal income tax purposes will be allowed to
the Company in an amount equal to the ordinary income taxable to an optionee
upon exercise,
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provided that such amount constitutes an ordinary and necessary business expense
to the Company and is reasonable, and further provided that the Company
satisfies its withholding obligation, if any, with respect to such income.
The foregoing statement is based on present federal tax laws and
regulations, and does not purport to be a complete description of the federal
income tax aspects of the Plan. In addition, participants may be subject to
certain state taxes, which are not described herein. Accordingly, each
participant should consult his or her tax advisor with regard to the tax aspects
of his or her participation in the Plan.
Securities to be Offered
The Plan covers shares of the Company's authorized but unissued Stock.
The Plan, as currently in effect, authorizes options for the purchase of 200,000
shares of Stock.
Participation in the Plan
Directors, key executives and employees of the Company, or any parent
or subsidiary corporation of the Company, who are selected by the Administrators
of the Plan, are eligible to participate in the Plan. Participants will be
selected for participation on the basis of their office or position held in the
Company, their degree of responsibility for the growth and success of the
Company, and their length of service, remuneration, promotions and performance.
The basis for determining the options which may be granted to participants in
the Plan is the same as that for determining who may participate in the Plan.
Restrictions on Sale of Shares
The Plan contains no restrictions on the sale of shares of Stock
following exercise of an option. However, restrictions on sales of Stock are
imposed by the Securities Act of 1933 (the "Act") with regard to sales of Stock
by an "affiliate" of the Company; i.e., a person who, directly or indirectly,
through one or more intermediaries controls, or is under common control with,
the Company. Sales by affiliates may, however, be made pursuant to Rule 144
promulgated under the Act, in a transaction exempt from registration under the
Act, or pursuant to an effective registration under the Act.
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Terms of the Plan
The price at which shares of Stock may be purchased upon exercise of an
option shall be determined by the Administrators of the Plan at the date of
grant of the option, but in no event will the price be less than the fair market
value of the Stock on that date. The granting of any option under the Plan does
not impose any obligation upon the participant to exercise the option.
The Administrators of the Plan may, in their discretion, provide that
an option may be exercised immediately or that it may not be exercised in whole
or in part for any specified period or periods of time. Provisions for
termination of any options shall be determined by the Administrators and set
forth in the stock option agreement, and may include termination of options upon
termination of employment, office or directorship. If such termination is as a
result of death or disability, the personal representative of the optionee shall
have six months after the date of death or disability to exercise the options
exercisable at the date of termination.
Adjustment of the Number of Shares
The number of shares of Stock subject to options and the price per
share shall be adjusted proportionately in the event of any subdivision or
consolidation of shares, the payment of a stock dividend or other transaction
which increases or decreases the number of issued shares of the Company but as
to which the Company does not receive payment for such shares.
Merger or Consolidation; Dissolution
If the Company shall be the surviving corporation in any merger or
consolidation, each outstanding option shall be equal to the securities to which
a holder of the number of shares of the Company stock subject to the option
would have been entitled in such merger or consolidation. A dissolution or
liquidation of the Company or a merger or consolidation in which the Company is
not the surviving corporation shall cause each outstanding option to terminate
unless obligations under the Plans are assumed by the surviving corporation;
provided, however, each optionee shall have the right immediately prior to any
such event to exercise all options held by such optionee in whole or in part
whether or not then exercisable under the terms of the option agreement.
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Securities Law Compliance
The Company is not obligated to grant any option under the Plans or to
sell or issue any shares pursuant to any option agreement executed pursuant to
the Plans unless the grant of the option or the sale of shares is effectively
registered, qualified or exempt from registration or qualification under all
applicable federal and state securities laws. The Company shall have the right
to suspend any optionee's ability to exercise any option granted under the Plans
if, in the Company's judgment, such suspension is necessary or desirable in
order to permit grants of options or sales of the Company's shares under the
Plans to qualify for any exemption from applicable registration and/or
qualification requirements.
Exercise of Stock Options
An option is exercised by delivering written notice of exercise to the
Company at its principal place of business, setting forth the number of shares
of Stock as to which the option is being exercised. Payment, accompanying the
notice, shall be by bank certified or cashier's check for the full amount of the
purchase price. Payment may also be made by surrender of a portion of the
options or other method of cashless exercise.
Assignment of Interest
Options may not be sold, pledged, assigned or transferred in any manner
other than by will or by the laws of descent and distribution, and may be
exercised only by the optionee.
Administration of the Plan
The Plan is to be administered by a Committee appointed by the Board of
Directors consisting of at least two members, all of whom must be "non-employee
directors" within the meaning of Rule 16b-3 promulgated by the Commission. If no
Committee is appointed, then the Board of Directors shall administer the Plans.
The Committee or the Board, as the case may be, determines which participants
will receive options, the time when options shall be granted, the terms of such
options (which may differ from one another), and the number of shares of Stock
covered by the options.
Certain Information for Future Years
Certain information referred to in this Prospectus will be updated
through an Appendix (the "Appendix") which will be furnished to each participant
in the Plan. The Appendix should be
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read in conjunction with this Prospectus. Although this Prospectus will not be
furnished to participants annually, the Company will furnish an additional copy
of this Prospectus to any participant upon request.
Incorporation of Certain Documents by Reference
The following documents, which have been filed by the Company with the
Commission, are incorporated by reference herein:
1. The Company's Annual Report to Shareholders for the Company's
most recent fiscal year.
2. All other reports filed by the Company pursuant to Sections
13(a) or 15(d) of the Exchange Act since the end of the
Company's most recent fiscal year.
3. All documents subsequently filed by the Company pursuant
to Sections 13(a) and (c), 14 and 15(d) of the Exchange
Act shall be deemed to be incorporated by reference into
this Prospectus and to be a part hereof from the date of
filing of such documents until such time that a post-
effective amendment to the Registration Statement has
been filed which indicates that all Stock issued hereby
has been sold or which deregisters all Stock remaining
unsold at the time of such amendment.
Experts
The consolidated balance sheets of Nitches, Inc. and subsidiaries as of
August 31, 1996, and the related consolidated statements of operations,
shareholders equity and cash flows for each of the two years in the period ended
August 31, 1996 incorporated in this Prospectus by reference from the Company's
Annual Report on Form 10-K have been audited by Deloitte & Touche LLP,
independent auditors, as stated in their report, which is incorporated herein by
reference, and have been so included in reliance upon the report of that firm
given upon their authority as experts in accounting and auditing.
The consolidated balance sheets of Nitches, Inc. and subsidiaries as
of August 31, 1997, and the related consolidated statements of operations,
shareholder's equity and cash flows for the year then ended, incorporated in
this Prospectus by reference from the Company's Annual Report on Form 10-K have
been audited by Moss Adams LLP, independent auditors, as stated in their report
which is incorporated herein by reference, and has been so included
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in reliance upon their report of that firm, given upon their authority as
experts in accounting and auditing.
Indemnification of Directors and Officers
The Articles of Incorporation and Bylaws of the Company provide that
the Company shall indemnify its officers, directors, employees and agents to the
fullest extent permitted by California law. Section 317 of the California
Corporations Code makes provisions for the indemnification of directors and
officers in terms sufficiently broad to indemnify directors and officers under
certain circumstances for liabilities (including reimbursement for expenses
incurred) arising under the Act. Section 317 and the Company's Articles of
Incorporation also permit the Company, through bylaw provisions and/or through
agreements with directors and officers to indemnify directors and officers in
excess of the indemnification otherwise permitted by Section 317. The form of
indemnification agreement currently used by the Company does not expressly
provide for exclusion of liability arising under the Act (except for a violation
of Section 16(b) of the Exchange Act). However, insofar as indemnification for
liabilities arising under the Act may be permitted to directors, officers or
persons controlling the Company pursuant to Section 317, the Company's Articles
of Incorporation, bylaws and form of indemnification agreement, the Company has
been informed that in the opinion of the Commission such indemnification is
against public policy as expressed in the Act and is therefore unenforceable.
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APPENDIX
This Appendix contains certain information supplementing the Prospectus
of Nitches, Inc. (the "Company"), dated January 8, 1998. The Appendix covers
shares of Common Stock, no par value (the "Stock"), issuable pursuant to the
exercise of options under the Company's Executive Option Plan of October 3,
1989, as amended October 16, 1995, and as amended August 24, 1996 (the "Plan").
Administration
The Plan is currently administered by a Committee which consists of
Luther A. Henderson and William L. Hoese. The business address of all members of
the Committee is 10280 Camino Santa Fe, San Diego, California 92121.
Eligibility and Participation
As of January 8, 1998, five directors and executive employees were
participating in the Plan and approximately five directors and executive
employees were eligible to participate in the Plan under current management
guidelines.
Outstanding Options
As of January 8, 1998, 53,000 options had been granted and exercised
under the Plan. As of January 8, 1998, the Company had options outstanding to
purchase 147,000 shares of its Stock under the Plan. For options outstanding as
of January 8, 1998, the number of shares issuable upon exercise of such options,
the exercise price per share, and the expiration dates of such options are as
follows:
Aggregate Average Exercise Range of
Number of Shares Price Per Share Expiration Dates
- ---------------- --------------- ----------------
147,000 $4.25 March 14, 1999 -
March 14, 2001
Miscellaneous
The Company will furnish to any optionee receiving a copy of this
Appendix, who has misplaced or discarded his or her copy of the Prospectus, an
additional copy of the Prospectus without charge upon written request to the
Secretary, Nitches, Inc., 10280 Camino Santa Fe, San Diego, California 92121.
The date of this Appendix is January 8, 1998.
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PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference
The following documents, which have been filed by the Company with the
Commission, are incorporated by reference herein:
1. The Company's Annual Report to Shareholders for the Company's
most recent fiscal year.
2. All other reports filed by the Company pursuant to Sections
13(a) or 15(d) of the Exchange Act since the end of the
Company's most recent fiscal year.
3. All documents subsequently filed by the Company pursuant to
Sections 13(a) and (c), 14 and 15(d) of the Exchange Act shall
be deemed to be incorporated by reference into this Prospectus
and to be a part hereof from the date of filing of such
documents until such time that a post- effective amendment to
the Registration Statement has been filed which indicates that
all Stock issued hereby has been sold or which deregisters all
Stock remaining unsold at the time of such amendment.
Item 6. Indemnification of Directors and Officers
The Articles of Incorporation and Bylaws of the Company provide that
the Company shall indemnify its officers, directors, employees and agents to the
fullest extent permitted by California law. Section 317 of the California
Corporations Code makes provisions for the indemnification of directors and
officers in terms sufficiently broad to indemnify directors and officers under
certain circumstances for liabilities (including reimbursement for expenses
incurred) arising under the Act. Section 317 and the Company's Articles of
Incorporation also permit the Company, through bylaw provisions and/or through
agreements with directors and officers to indemnify directors and officers in
excess of the indemnification otherwise permitted by Section 317. The form of
indemnification agreement currently used by the Company does not expressly
provide for exclusion of liability arising under the Act (except for a violation
of Section 16(b) of the Exchange Act). However, insofar as indemnification for
liabilities arising under the Act may be permitted to directors, officers or
persons controlling the Company pursuant to Section 317, the Company's Articles
of Incorporation, bylaws and form of indemnification agreement, the Company has
been informed that in the opinion of the
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Commission such indemnification is against public policy as expressed in the Act
and is therefore unenforceable.
Item 8. Exhibits
Exhibit Number Description
4.1 Articles of Incorporation of the Company, as
amended(1)
4.2 Bylaws of the Company, as amended(2)
5 Opinion of Luce, Forward, Hamilton & Scripps
LLP regarding legality of securities being
offered
23.1 Consent of Moss Adams LLP
23.2 Consent of Deloitte & Touche LLP
23.3 Consent of Luce, Forward, Hamilton & Scripps
LLP (filed as a portion of Exhibit 5)
24 Power of Attorney (included on signature page)
99 Executive Option Plan as amended
(1) Incorporated by reference from Form 10-K for the fiscal year ended November
21, 1990 and from the Form 10-Q for the period ended November 30, 1995.
(2) Incorporated by reference from Form 10-K for the fiscal year ended August
31, 1988, Exhibit 3.2, File No. 0-13851.
Item 9. Undertakings
1. The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Act, each filing of the Registrant's annual
report pursuant to Section 13(a) or 15(d) of the Exchange Act (and, where
applicable, each filing of an employee benefit plan's annual report pursuant to
Section 15(d) of the Exchange Act) that is incorporated by reference in the
Registration Statement shall be deemed to be a new Registration Statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
2. The undersigned Registrant hereby undertakes to deliver or cause to be
delivered with the Prospectus to each employee to whom the Prospectus is sent or
given a copy of the Registrant's annual report to stockholders for its last
fiscal year, unless such employee otherwise has received a copy of such report,
in which
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case the Registrant shall state in the Prospectus that it will promptly furnish,
without charge, a copy of such report on written request of the employee. If the
last fiscal year of the Registrant has ended within 120 days prior to the use of
the Prospectus, the annual report of the Registrant for the preceding fiscal
year may be so delivered, but within such 120 day period the annual report for
the last fiscal year will be furnished to each such employee.
3. The undersigned Registrant hereby undertakes to transmit or cause to be
transmitted to all employees participating in the Plan who do not otherwise
receive such material as stockholders of the Registrant, at the time and in the
manner such material is sent to its stockholders, copies of all reports, proxy
statements and other communications distribute to its stockholders generally.
SIGNATURES
Pursuant to the requirements of the Securities Act cf 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 San Diego, and State California, on this 8th day of
January, 1998.
NITCHES, INC.
By:\s\ STEVEN P. WYANDT
-------------------------------------
Steven P. Wyandt, President
and Chief Executive Officer
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POWER OF ATTORNEY
We, the undersigned directors and officers of Nitches, Inc. ("Company")
do hereby severally constitute and appoint Steven P. Wyandt our true and lawful
attorney and agent, to do any and all things and acts in our names in the
capacities indicated below and to execute any and all instruments for us and in
our names in the capacities indicated below which said Steven P. Wyandt may deem
necessary or advisable to enable the Company to comply with the rules,
regulations and requirements of the Securities and Exchange Commission, in
connection with the Registration Statement on Form S-8 relating to the offering
of the Company's Common Stock, including specifically, but not limited to, power
and authority to sign for us or any of us in our names in the capacities
indicated below, the Registration Statement and any and all amendments
(including post-effective amendments) or supplements thereto; and we hereby
ratify and confirm all that said Steven P. Wyandt shall do or cause to be done
by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration Statement has been signed below by the following persons in the
capacities and on the date indicated.
Dated: January 8, 1998 \S\ STEVEN P. WYANDT
---------------------------------
Steven P. Wyandt, President,
Chief Executive Officer, Chief
Financial Officer and Director
January 8, 1998 \S\ ARJUN C. WANEY
---------------------------------
Arjun C. Waney, Chairman of the
Board and Director
January 8, 1998 \S\ LUTHER A HENDERSON
---------------------------------
Luther A. Henderson, Director
January 8, 1998 \S\ EUGENE B. PRICE II
---------------------------------
Eugene B. Price II, Director
January 8, 1998 \S\ WILLIAM L. HOESE
---------------------------------
William L. Hoese, Director
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EXHIBIT INDEX
Exhibit Number Description
4.1 Articles of Incorporation of the
Company, as amended(1)
4.2 Bylaws of the Company, as
amended(2)
5 Opinion of Luce, Forward,
Hamilton & Scripps, LLP
regarding legality of securities
being offered
23.1 Consent of Moss Adams LLP
23.2 Consent of Deloitte & Touche LLP
23.3 Consent of Luce, Forward,
Hamilton & Scripps, LLP (filed
as a portion of Exhibit 5)
24 Power of Attorney (included on
signature page)
99 Executive Option Plan, as
amended
(1) Incorporated by reference from Form 10-K for the fiscal year ended November
21, 1990 and from the Form 10-Q for the period ended November 30, 1995.
(2) Incorporated by reference from Form 10-K for the fiscal year ended August
31, 1988, Exhibit 3.2, File No. 0-13851.
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January 8, 1998
Nitches, Inc.
10280 Camino Santa Fe
San Diego, CA 92121
Re: Registration Statement on Form S-8 for
200,000 Shares of Common Stock
Ladies and Gentlemen:
We have acted as your counsel in the preparation of a Registration Statement on
Form S-8 (the "Registration Statement") to be filed with the Securities and
Exchange Commission to register 200,000 shares of common stock, no par value per
share (the "Common Stock"), of Nitches, Inc., a California corporation (the
"Company"), to be issued pursuant to the Company's Executive Option Plan (the
"Plan").
For purposes of rendering this opinion, we have made such legal and factual
examinations as we have deemed necessary under the circumstances and, as part of
such examination, we have examined, among other things, originals and copies,
certified or otherwise, identified to our satisfaction, of such documents,
corporate records and other instruments as we have deemed necessary or
appropriate. For the purposes of such examination , we have assumed the
genuineness of all signatures on original documents and the conformity to
original documents of all copies submitted to us.
On the basis of and in reliance upon the foregoing examination and assumptions,
we are of the opinion that assuming the Registration Statement shall have become
effective pursuant to the provisions of the Securities Act of 1933, as amended,
the shares of Common Stock being offered under the Plan when issued in
accordance with the Registration Statement and the provisions of the Plan will
be validly issued, fully paid and nonassessable.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement.
Very truly yours,
LUCE, FORWARD, HAMILTON & SCRIPPS LLP
II-6
CONSENT
We hereby consent to the incorporation by reference in this
Registration Statement on Form S-8 of Nitches, Inc. (formerly Beeba's Creations,
Inc) of our report dated October 10, 1997, appearing in Item 8 in the Annual
Report on Form 10-K for the year ended August 31, 1997 and to the reference to
us under the heading "Experts" in the Prospectus, which is a part of this
Registration Statement.
\s\ MOSS ADAMS LLP
Los Angeles, California
January 7, 1998
II-7
CONSENT
We consent to the incorporation by reference in this Registration
Statement on Form S-8 of Nitches, Inc. (formerly Beeba's Creations, Inc) of our
report dated October 31, 1996, appearing in the Annual Report on Form 10-K of
Nitches, Inc. for the year ended August 31, 1997 and to the reference to us
under the heading "Experts" in the Prospectus, which is a part of this
Registration Statement.
\s\ DELOITTE & TOUCHE LLP
San Diego, California
January 7, 1998
II-8
NITCHES, INC.
EXECUTIVE OPTION PLAN
Effective
August 24, 1996
1. Purpose of the Plan. The purpose of this Executive Option Plan (the
"Plan") is to serve as an incentive to, and to encourage stock ownership by,
selected executive employees and Directors of the Board of Nitches, Inc., a
California corporation or its parent or subsidiary corporations, (collectively
the "Company"), so that they may participate in the Company's growth and
profitability and to induce them to remain in the employ or serve on the Board
of Directors of the Company. The Plan is not intended to qualify under any
relevant section of the Internal Revenue Code.
2. Administration. Subject to the authority of the Company's Board of
Directors, the Plan shall be administered by a Committee appointed by the Board
of Directors (the "Committee"), consisting of at least two independent directors
who shall serve at the pleasure of the Board of Directors and all of whom shall
be "nonemployee" directors within the meaning of Securities and Exchange
Commission Rule 16b-3 to the extent possible. If no Committee has been
appointed, the Board of Directors shall be the Committee. Subject to the
provisions of the Plan, the Committee shall have sole authority, in its absolute
discretion, to determine which employees or members of the Board of Directors of
the Company shall receive Options for the purchase of shares under the Plan
("Options"), the time when Options shall be granted, the terms of such Options
(which may differ from one another to the extent not inconsistent with this
Plan), and the number of shares to be subject to Options. Acts by a majority of
the Committee in a meeting at which a quorum is present and consents in writing
by a majority of the members of the Committee shall be valid acts of the
Committee. The Committee shall have authority to do everything necessary or
appropriate to administer the Plan, including, without limitation, interpreting
the provisions of the Plan. All decisions, determinations and interpretations of
the Committee shall be final and binding on all optionees. No member of the
Committee or the Board of Directors shall be liable for any action or
determination made in good faith with respect to the Plan or any Option granted
thereunder.
3. Eligible Participants. All executive employees or members of the
Board of Directors of the Company or any parent or subsidiary corporation of the
Company (including subsidiaries which become such after the adoption of the
Plan) who are selected by the Committee shall be eligible to participate in the
Plan. In determining the executives or Board Member to whom Options are to be
granted and the terms of the Options, the Committee may consider all relevant
factors, including but not limited to, the following: the office or position of
the executive or Board Member and his or her degree of responsibility for growth
and success of the Company; length of service; remuneration; promotions; and
potential performance. No person shall be granted an Option under the Plan
unless, on the date of grant, such person is an executive employee or member of
the Board of Directors of the Company.
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4. Stock Subject to the Plan. The stock subject to the Plan shall be
shares of the Company's authorized but unissued or acquired or reacquired common
stock. Subject to the provisions of Sections 5.6, 5.7 and 5.8 of the Plan, the
maximum aggregate number of shares for which Options may be granted and sold
under the Plan is 200,000. If any Option granted hereunder shall expire or
terminate for any reason without having been exercised in full, then unpurchased
shares subject thereto shall again be available for purposes of this Plan.
5. Terms and Conditions of Options. Any Option granted pursuant to the
Plan shall be evidenced by an agreement in such form as the Committee shall from
time to time determine, which agreement shall comply with and be subject to the
following terms and conditions:
5.1 Number of Shares. Each Option shall state the number of
shares to which it pertains.
5.2 Option Exercise Price. Each Option shall state the Option
exercise price. The Option exercise price shall be determined by the Committee,
but in no event shall the price be less than the stock's fair market value on
the date of the grant.
5.3 Method of Exercise. An Option shall be exercised by the
delivery of both written notice (on a form to be adopted by the Committee) of
exercise to the Company at its principal place of business by the person
entitled to exercise the Option and payment for the shares with respect to which
the Option is exercised. Payment shall be by bank certified or cashier's check,
by surrender of a portion of the options or other method of cashless exercise.
Until an optionee becomes a shareholder of record, no right to vote or to
receive dividends or any other rights as a shareholder shall exist with respect
to shares notwithstanding the exercise of the Option. No adjustment shall be
made for dividend or other rights as to which the record date precedes the date
the optionee becomes a shareholder of record, except as provided in Section 5.7.
Options may not be exercised as to fractional shares. As soon as reasonably
practicable after receipt by the Company of a notice of exercise, the Company
shall deliver to the optionee at the principal office of the Company, or at such
other appropriate place as may be determined by the Committee, a certificate or
certificates for shares of stock with respect to which the Option is exercised.
Notwithstanding the foregoing, the Company may postpone delivery of any
certificate or certificates after notice of exercise for such reasonable period
as may be required to comply with any applicable listing requirements of any
national or other securities exchange. In the event an Option shall be
exercisable by any person other than the optionee, the required notice under
this section 5.3 shall be accompanied by appropriate proof of the right of such
person to exercise the Option.
5.4 Option Exercise Period. Each Option granted under the Plan
shall be exercisable and shall expire on a date, or in installments, as fixed by
the Committee, and shall contain such other terms as may be determined by the
Committee and as set forth in the stock option agreement.
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5.5 Term of Options. The term of an Option granted to an
employee or Board Member under this Plan is to be determined by the Committee
and shall be set forth in the stock option agreement. The Committee may, among
other things, provide for the termination of any Option in the event the
optionee leaves the employ or ceases to be a director of the Company for any
reason. If such a provision is contained in the stock option agreement, then
notwithstanding that provision:
(i) In the event of termination of employment or service
on the Board of Directors of an optionee due to the optionee's death, the
personal representatives of the optionee or any person or persons to whom the
rights of the optionee under such Options pass by will or by the applicable laws
of descent and distribution (collectively "Representatives") may, at any time
within a period of six months after the death of such optionee, exercise any or
all of such Option rights to the extent such Option rights are exercisable on
the date of death of such optionee; and
(ii) In the event termination of optionee's employment
or service on the Board of Directors is due to the disability of the optionee
(within the meaning of Section 22(e)(3) of the Internal Revenue Code of 1986),
the optionee, or if the optionee thereafter dies, the Representatives may, at
any time within a period of six months after the optionee's termination of
employment or service on the Board of Directors, exercise any or all of such
Option rights to the extent such Option rights are exercisable on the date of
the termination of employment or service on the Board of Directors. The
Committee shall determine whether an authorized leave of absence, absence for
military or governmental service or disability shall constitute termination of
employment for purposes of this Section 5.5. Such determination shall be subject
to review by the Board of Directors.
5.6 Recapitalization. Subject to any required action by the
Company's shareholders, the number of shares of stock which may be purchased
upon the exercise of each outstanding Option, and the exercise price per share
set forth in such Option, shall be proportionately adjusted for any increase or
decrease in the number of issued shares of stock of the Company resulting from
any subdivision or consolidation of shares, the payment of a stock dividend, or
any other transaction in which the company increases or decreases its issued
shares but does not receive payment for such shares. Any fraction of a share
subject to an Option that would otherwise result from an adjustment pursuant to
this Section 5.6 shall be rounded downward to the next full number of shares
without other compensation or consideration to the holder of such Option.
5.7 Mergers or Dissolution. Subject to any required action by
the Company's shareholders, if the Company shall be the surviving corporation in
any merger or consolidation, each outstanding Option shall pertain to and apply
to the securities and other property to which a holder of the number of shares
of the Company's stock subject to the Option would have been entitled in such
merger or consolidation. Unless the obligations under the Options are assumed by
the surviving corporation, a dissolution or liquidation of the Company or a
merger or a
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consolidation in which the Company is not the surviving corporation shall cause
each outstanding Option to terminate; provided, however, that if the Company's
obligations under the Option are not assumed by the surviving corporation, each
optionee shall have the right immediately prior to such dissolution or
liquidation, or merger or consolidation in which the Company is not the
surviving corporation, to exercise all Options held by such optionee in whole or
in part, whether or not then exercisable under the terms of the option
agreement. If the Company should be consolidated with, or merged into, any other
corporation, or if the Company should sell or transfer substantially all of its
assets, or if any other similar event affecting shares of stock of the Company
should occur, and if the acquiring corporation assumes the Company's obligations
under the Options granted under this Plan, then each optionee shall be entitled
thereafter to purchase shares of stock and other securities and property in the
kind and amount, and at the price, to which the optionee would have been
entitled had the optionee's Option been exercised prior to such event.
5.8 Adjustments by Committee. To the extent that the
adjustments set forth in Sections 5.6 and 5.7 relate to stock or securities of
the Company, such adjustments shall be made by the Committee. The determination
of the Committee shall be final, binding and conclusive. The grant of an Option
pursuant to the Plan shall not affect 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, liquidate,
or sell or transfer all or any part of its business or assets.
5.9 Modification, Extension and Renewal of Options. Subject to
the terms and conditions and within the limitations of the Plan, the Committee
may modify, extend or renew outstanding Options granted under the Plan, or
accept the surrender of outstanding Options to the extent not exercised and
authorize the granting of new Options and substitutions therefor.
5.10 Withholding Taxes. Notwithstanding anything else to the
contrary in the Plan or any stock option agreement, the exercise of any Option
shall be conditioned upon payment by such optionee in cash, or other provisions
satisfactory to the Committee for payment by the optionee, to the Company of all
local, state and federal withholding taxes applicable, in the Company's
judgment, to the exercise, or the later disposition of shares acquired upon
exercise, of an Option.
5.11 Reports to Optionees. The Company shall provide financial
and other information regarding the Company to each optionee at least annually
while such optionee's Option is outstanding. Such financial and other
information shall be the information regularly
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provided by the Company to each of its shareholders, and shall be provided to
such optionee when and substantially in the manner provided to the Company's
shareholders.
5.12 Other Provisions. The option agreements authorized under
the Plan shall contain such other provisions, including, without limitation,
restrictions upon the exercise of the Option and sale of stock acquired upon
exercise of the Option, as the Committee and the Board of Directors shall deem
advisable.
6. Non-Assignability of Options. Options granted under the Plan may not
be sold, pledged, assigned or transferred in any manner other than by will or by
the laws of descent and distribution, and may be exercised during the lifetime
of an optionee only by such optionee. For purposes of the Plan, the term
"optionee" shall be deemed to include representatives.
7. Term of Plan. The Plan shall become effective upon its adoption by
the Board of Directors. It shall continue in effect until terminated pursuant to
Section 8. In no event shall Options be granted under the Plan after its
termination.
8. Amendment or Termination of the Plan. The Board of Directors may
amend the Plan from time to time. The Board of Directors may terminate the Plan
at any time. Any such termination shall not affect Options already granted and
such Options shall remain in full force and effect as if the Plan had not been
terminated.
9. Application of Funds. The proceeds received by the Company from the
sale of stock pursuant to Options granted under the Plan shall be used for
general corporate purposes.
10. Securities Law Compliance. The committee may, in its discretion,
cause the Plan, Options issued hereunder and the shares to be offered pursuant
to Options granted hereunder to be registered and/or qualified in accordance
with the applicable regulations under the Securities Act of 1933, as amended,
and the California Corporate Securities Law of 1968, as amended. If the Company
has not so registered and qualified the plan and such Options and shares, the
Company may, as a condition to the exercise of any portion of an Option, require
the employee exercising such Option to represent and warrant at the time of such
exercise that the shares are being purchased only for investment and without any
present intention to sell or distribute such shares, if, in the opinion of
counsel for the Company, such a representation is required under the securities
Act of 1933, as amended, or any other applicable federal or state law, or any
regulation or rule of any governmental agency, and for this purpose may require
such other representations as the Company reasonably may deem to be necessary.
Notwithstanding any provision of the Plan to the contrary, the Company shall not
be obligated to grant any Option under the Plan or to sell or issue any shares
pursuant to any option agreement executed pursuant to the Plan, and no such
grant of Option or sale of shares shall be effective, unless such grant of
Option or sale is effectively registered, qualified or exempt from registration
and qualification under all applicable federal and state securities laws. The
Committee shall have the right to suspend any optionee's ability to exercise any
Option granted under the Plan (or any portion thereof) if, but only if, in the
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Committee's judgment, such suspension is necessary or desirable in order to
permit grants of options or sales of the Company's shares under the Plan to
qualify for any exemption from the registration and/or qualification
requirements of applicable state and federal securities laws. Any such
suspension of exercisability shall be for such period or periods as are
determined by the Committee. Neither the Company nor the Committee, nor any
officers, directors or members thereof, shall have any liability with respect to
the non-issuance or failure to sell shares as the result of any suspensions of
exercisability imposed pursuant to this section 10.
11. Reservation of Shares and Common Stock. The Company, during the
term of this Plan, shall at all times reserve and keep available an adequate
number of shares of common stock, and shall seek or obtain from any regulatory
body having jurisdiction any requisite authority in order to issue and sell such
number of the shares as shall be sufficient to satisfy the requirements of the
Plan. Notwithstanding the foregoing, nothing set forth in the Plan shall be
construed so as to require the Company to register or qualify any transaction
under the Plan or Options issued thereunder with any state or federal
governmental agency.
12. Employment Relationship. Nothing set forth in this Plan or any
Option granted hereunder shall be construed so as to (i) in any way limit the
right of the Company, its parent or subsidiaries to terminate any optionee's
employment or service on the Board of Directors at any time, or (ii) confer upon
any optionee any right to continue in the employ of the Company, its parent or
subsidiaries.
13. Definitions. As used in the Plan, the terms "parent" and
"subsidiary" shall have the meaning ascribed to them in Section 424 of the
Internal Revenue Code of 1986.
IN WITNESS WHEREOF, the Plan has been adopted by the Board of Directors
of the Company on October 3, 1989 and amended by the Board of Directors of the
Company on October 16, 1995 and August 24, 1996.
NITCHES, INC.
By: \s\ STEVEN P. WYANDT
-----------------------------
Steven P. Wyandt, President
6
