As filed with the Securities and Exchange Commission on
January 24, 2000.
Registration No. 333-____________
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
___________________
THE WET SEAL, INC.
(Exact Name of Registrant as Specified in Its Charter)
Delaware 33-0415940
(State or Other Jurisdiction of Incorporation (I.R.S. Employer
or Organization) Identification Number)
26972 Burbank
Foothill Ranch, California 92610
(949) 583-9029
(Address, Including Zip Code, and Telephone Number, Including Area Code of,
Registrant's Principal Executive Offices)
Edmond S. Thomas
26972 Burbank
Foothill Ranch, California 92610
(949) 583-9029
(Name, Address, Including Zip Code, and Telephone Number, Including Area Code,
of Agent For Service)
___________________
Copy to:
Alan Siegel, Esq.
Akin, Gump, Strauss, Hauer & Feld, L.L.P.
590 Madison Avenue
New York, New York 10022
___________________
Approximate date of commencement of proposed sale to the public: From
time to time or at one time after the effective date of this registration
statement as determined by the selling stockholder.
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, other than securities offered only in connection with
dividend or interest reinvestment plans, check the following box. [X]
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
<PAGE>
If this form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration
statement for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box. [ ]
___________________
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
==========================================================================================================
Proposed Proposed
Amount Maximum Maximum Amount of
Title of Shares to be Offering Price Aggregate Registration
to be Registered Registered Per Share(1) Offering Price(1) Fee
<S> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------
Class A Common
Stock 348,500 $11.41 $3,976,385 $1,106
==========================================================================================================
</TABLE>
(1) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457 under the Securities Act of 1933, based on the average high
and low sales prices of the Class A Common Stock on January 14, 2000 as reported
by the Nasdaq National Market.
The registrant hereby amends this registration statement on the date or
dates as may be necessary to delay its effective date until the registrant shall
file a further amendment which specifically states that this registration
statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until this registration statement shall become
effective on a date that the Commission, acting pursuant to said Section 8(a),
may determine.
================================================================================
<PAGE>
Subject to Completion, January 24, 2000
PROSPECTUS
THE WET SEAL, INC.
348,500 SHARES
OF CLASS A COMMON STOCK
___________________
The shares of class A common stock offered by this prospectus
are being offered by the stockholders of our company named in the section
entitled "Selling Stockholders" on page 5. The selling stockholders may sell the
shares of class A common stock from time to time in various types of transaction
including:
* on the Nasdaq National Market;
* in the over-the-counter market; and
* in privately negotiated transactions.
For additional information on methods of sale, you should
refer to the section entitled "Plan of Distribution" on page 5. Our company will
not receive any portion of the proceeds from the sale of these shares.
Our Company's class A common stock is quoted on the Nasdaq
National Market under the symbol "WTSLA."
The selling stockholders will determine the price of the shares
of class A common stock independent of our company. On January 19, 2000, the
last sale price of the class A common stock on the Nasdaq National Market was
$11-13/16 per share.
Investing in these securities involves a high degree of risk.
See the Risk Factors section beginning on page 1.
Neither the Securities and Exchange Commission nor any state
securities commission has approved or disapproved of these securities or passed
upon the adequacy or accuracy of the disclosures in the prospectus.
Any representation to the contrary is a criminal offense.
The information in this prospectus is not complete and may be
changed. We may not sell these securities until the registration statement filed
with the Securities and Exchange Commission is effective. This prospectus is not
an offer to sell these securities and it is not soliciting an offer to buy these
securities in any state where the offer or sale is not permitted.
The date of this Prospectus is____________________.
<PAGE>
TABLE OF CONTENTS
Page
----
Risk Factors...................................................1
You Should Not Rely on Forward-Looking Statements
Because They Are Inherently
Uncertain......................................................3
Where You Can Find More Information............................4
The Company....................................................5
Use of Proceeds................................................5
Selling Stockholders...........................................5
Plan of Distribution...........................................5
Experts........................................................7
Legal Matters..................................................7
We have not authorized any dealer, salesperson or other person
to give any information or represent anything not contained in this prospectus.
You should not rely on any unauthorized information. This prospectus does not
offer to sell or buy any shares in any jurisdiction in which it is unlawful. The
information in this prospectus is current as of the date on the cover.
i
<PAGE>
RISK FACTORS
Before you invest in our class A common stock, you should be
aware that there are various risks, including those described below. You should
carefully consider these risk factors, together with all of the other
information included in this prospectus, before you decide whether to purchase
shares of our class A common stock.
Comparable Store Sales - Our stock price depends, in part, on our ability to
sustain comparable store sales growth.
The stock price of many retail companies, including our
company, depends, in part, on the company's ability to sustain comparable store
sales growth. The term "comparable store sales" refers to sales in stores that
were open for at least 14 full fiscal months. There can be no assurance that
comparable store sales will not decline in the future. Flat or declining
comparable store sales may result in lower prices for our stock.
Stock Price Volatility - Our stock price fluctuates substantially.
Our class A common stock is quoted on the Nasdaq National
Market, and has experienced, and is likely to experience in the future,
significant price and volume fluctuations which could adversely affect the
market price of our class A common stock without regard to our operating
performance. In addition, we believe that factors such as quarterly fluctuations
in our financial results, our comparable store sales results, announcements by
other apparel retailers, the overall economy and the condition of the financial
markets could cause the price of our class A common stock to fluctuate
substantially.
Changes in Fashion Trends - Our profitability depends on our ability to
anticipate and react to new trends.
Our profitability depends largely on our ability to anticipate
the changing fashion tastes of our customers and to respond to those changing
tastes in a timely manner. The fashion tastes of our customers may change
frequently and if we fail to anticipate, identify or react appropriately to
changing styles, trends or brand preferences of our customers, we may experience
lower sales, excess inventories and more frequent markdowns, which could have a
material adverse effect on our business. In addition, if we misjudge fashion
trends, our image with our customers may be significantly impaired. If we do not
appropriately ascertain our customers' desires or timely react to their changing
tastes, our long-term sales, profitability and growth may be significantly and
negatively impacted.
Competition - We compete with other retailers for sales and locations and may
experience heightened competition from internet retailers.
The young women's retail apparel industry is highly
competitive. Fashion, quality, price, location, in-store environment and service
are the principal factors in competing successfully in the retail industry. We
compete for sales with specialty apparel retailers, department stores and other
apparel retailers, including The Limited, The Gap, Gadzooks and Pacific Sunwear,
and on a regional basis with Charlotte Russe. In addition, we compete for
favorable site locations and lease terms in shopping malls. Some of our
competitors have more resources than our company. Competition may significantly
increase in the future, which could adversely affect our company.
In addition to competition from traditional retailers, we also
compete with catalog and internet businesses that handle similar lines of
merchandise. In particular, retail sales from internet sites may increase as a
result of, among other things, the following factors:
* customers can more easily conduct price comparisons for
comparable clothing on the internet which could result in
decreased margins;
* internet sales by our competitors could enhance price
competition;
* the inapplicability of sales tax to internet sales
provides internet sales with a competitive advantage and
makes it more attractive to customers; and
* less expensive products are currently more susceptible to
internet sales.
1
<PAGE>
In January 1998, we introduced the "Wet Seal Catalog." In August 1999, we
reintroduced this catalog as the "Blue Asphalt" magalog (a catalog with
editorial content) and a related internet site under the Blue Asphalt name.
Currently, we are not publishing the magalog. There can be no assurance that we
will be able to compete successfully through our catalog or internet business.
Failure to successfully implement our internet business could adversely affect
our company. In addition, our internet business could, to some extent, compete
with our in-store business.
Economic Conditions and Consumer Spending - Our business is affected by local,
regional and national economic conditions.
Our business is sensitive to consumer spending patterns and
preferences. Our growth, sales and profitability may be adversely affected by
unfavorable local, regional or national economic conditions. We are especially
affected by economic conditions in California, where approximately 21% of our
stores are located.
Most of our stores are located in regional shopping malls. We
derive sales, in part, from the high volume of traffic in these malls. As a
result, we benefit from the ability of mall "anchor" tenants and other area
attractions to generate consumer traffic around our stores and the continuing
popularity of malls as shopping destinations. Sales volume and mall traffic may
be adversely affected by:
* economic downturns in a particular area,
* competition from non-mall retailers and other malls,
* the closing of anchor department stores, and
* declines in the desirability of the shopping environment
in a particular mall.
Any or all of the above factors could adversely affect our sales and
profitability.
Our sales and profitability also depend upon the continued
demand by our customers for fashionable, casual apparel. If the demand for
apparel and related merchandise were to decline, our financial condition and
results of operations could be materially and adversely affected. Shifts in
consumer discretionary spending to other goods such as electronic equipment,
computers and music could also adversely affect our company.
Demographic Expansion - We will need to increase our demographic scope to
continue the growth of our business.
Our company has historically expanded by opening new stores,
remodeling existing stores and acquiring other businesses that complement and
enhance our operations and focus on our target market of primarily teen-age
girls, such as Contempo Casuals, Inc. As that business matures, we believe that
we will need to increase our demographic scope to continue our growth. We have
created new retail concepts such as our Arden B. stores, which target
fashionable young contemporary women, and our Limbo Lounge stores, which target
both juniors and young men. These are new fashion businesses and there can be no
assurance that these businesses will gain consumer acceptance. In addition,
these businesses involve risks associated with the retail apparel industry in
general.
Seasonality and Inflation - Our business is seasonal in nature and may be
affected by inflation.
The retail apparel industry is highly seasonal. We generate
our highest level of sales during the Christmas season (beginning the week of
Thanksgiving and ending the first Saturday after Christmas) and the "back to
school" season (beginning the last week of July and ending the first week of
September). Our profitability depends, to a significant degree, on the sales
generated during these peak periods. Any decrease in sales or margins during
these periods, whether as a result of then current economic conditions, poor
weather or other factors beyond our control, could have a material adverse
effect on our company.
We do not believe that inflation has had a material effect on
our company's results of operations during the past three years. However, there
can be no assurance that our business will not be affected by inflation in the
future.
2
<PAGE>
Year 2000 Compliance - Year 2000 problems could affect our day-to-day operations
and cause significant economic liabilities.
The Year 2000 issue is the result of computer programs being
written using two digits rather than four to define the applicable year. Any of
our company's computer programs that have date-sensitive software may recognize
a date using "00" as the year 1900 rather than the year 2000.
We have reviewed and converted our existing computer software
systems and hardware to identify processes which may be affected by Year 2000
problems. To date, no significant issues have been identified or have arisen. We
have also obtained assurances from vendors and independently verified that new
computer software systems and hardware that we purchase are Year 2000 compliant.
In addition, we have reviewed our relationships with suppliers and financial
institutions to obtain assurances that their systems are Year 2000 compliant.
However, if we fail to completely mitigate internal and
external Year 2000 risks, the result could be a system failure causing
disruption of operations, including, among other things, a temporary inability
to process transactions, distribute merchandise, or engage in similar normal
business activity at our company or our vendors and suppliers. Any or all of the
above factors could have a material adverse effect on our business, results of
operations, cash flows and financial condition.
Dependence on Key Personnel - Our company relies on the experience of our senior
management. Competition for senior management is intense.
Our company's success depends to a significant extent upon the
performance of our senior management, particularly personnel engaged in
merchandising and store operations. Our success also depends, in part, on our
ability to identify, hire and retain additional key management personnel.
Competition for qualified personnel in the retail apparel industry is intense
and our inability to identify, hire or retain key personnel could have a
material adverse effect on our company.
Voting Rights of Common Stock; Control by Selling Stockholders - Shares of class
B common stock have greater voting rights than class A common stock. The selling
stockholders have significant voting power.
The voting rights of class A common stock are limited by our
Restated Certificate of Incorporation. On all matters with respect to which our
stockholders have a right to vote, including for the election of directors, a
holder of class A common stock is entitled to one vote per share, while a holder
of class B common stock is entitled to two votes per share. Except as otherwise
required by law, class A common stock and class B common stock vote together as
a single class. Each share of class B common stock is immediately convertible
into one share of class A common stock. As of the date of this prospectus, there
were 2,912,665 shares of class B common stock outstanding and 9,542,286 shares
of class A common stock outstanding.
Prior to this offering, Irving Teitelbaum, Chairman of the
Board, and Stephen Gross, Secretary and a Director of our company, may be deemed
to beneficially own an aggregate of 348,500 shares of class A common stock
(excluding shares of class B common stock immediately convertible into class A
common stock) and 2,445,573 shares of class B common stock, representing 34.1%
of the voting power of all classes of our capital stock.
Following consummation of this offering, Messrs. Teitelbaum
and Gross may be deemed to beneficially own no shares of class A common stock
(excluding shares of class B common stock immediately convertible into class A
common stock) and 2,445,573 shares of class B common stock, representing 31.8%
of the voting power of all classes of our capital stock. As a result, Messrs.
Teitelbaum and Gross may be able to significantly influence the election of all
the directors of our company and significantly influence the outcome of any
matter submitted to a vote of stockholders, including any merger, consolidation
or sale of all or substantially all of our assets, except as otherwise provided
by law.
YOU SHOULD NOT RELY ON FORWARD-LOOKING STATEMENTS BECAUSE THEY ARE
INHERENTLY UNCERTAIN
This prospectus contains forward-looking statements that
involve risks and uncertainties. You should not rely on these forward-looking
statements. We use words such as "anticipates," "believes," "plans," "expects,"
"future," "intends" and similar expressions to identify forward-looking
statements. These statements
3
<PAGE>
appear throughout the prospectus and are statements regarding our intent,
belief, or current expectations, primarily with respect to our operations and
related industry developments. You should not place undue reliance on these
forward-looking statements, which apply only as of the date of this prospectus.
Our actual results could differ materially from those anticipated in these
forward-looking statements for many reasons, including, without limitation:
* our retention of suppliers for both brand name and The
Wet Seal, Inc. developed merchandise,
* our ability to expand and to continue to increase
comparable store sales,
* the sufficiency of our company's working capital and cash
flows from operating activities,
* a decline in demand for our merchandise,
* our ability to locate and obtain acceptable store sites
and lease terms or renew existing leases,
* our ability to obtain an adequate supply of merchandise,
* our ability to hire and train employees,
* our ability to gauge the fashion tastes of our customers
and provide merchandise that satisfies customer demand,
* management's ability to manage our expansion,
* the effect of economic conditions,
* the effect of severe weather or natural disasters, and
* the effect of competitive pressures from other retailers,
including retail sales from internet sites.
WHERE CAN YOU FIND MORE INFORMATION
This prospectus is part of a registration statement on Form
S-3 that we filed with the Securities and Exchange Commission. Some information
in the registration statement has been omitted from this prospectus in
accordance with SEC rules. We file annual, quarterly and special reports, proxy
reports, proxy statements and other information with the SEC. You can read and
copy the registration statement as well as reports, proxy statements and other
information we have filed with the SEC at the public reference room maintained
by the SEC at 450 Fifth Street, NW, Washington, D.C. 20549, and at the following
Regional Offices of the SEC: Seven World Trade Center, New York, New York 10048,
and Northwest Atrium Center, 500 West Madison Street, Chicago, Illinois 60661.
You can call the SEC at 1-800-732-0330 for further information about the public
reference room. We are also required to file electronic versions of these
documents with the SEC, which may be accessed through the SEC's World Wide Web
site at http://www.sec.gov. Our class A common stock is quoted on The Nasdaq
National Market under the symbol "WTSLA." Reports, proxy and information
statements and other information concerning our company may be inspected at The
Nasdaq Stock Market at 1735 K Street, NW, Washington, D.C. 20006.
The SEC allows us to "incorporate by reference" the
information we have previously filed with it, which means we can disclose
important information by referring to those documents. All information that we
have incorporated by reference is available to you in accordance with the above
paragraph. Information that we file with the SEC subsequent to the date of this
prospectus will automatically update and supersede this information. We
incorporate by reference the documents listed below and any future filings made
with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange
Act of 1934 until the selling stockholders have sold all the shares:
1. Our Annual Report on Form 10-K for the fiscal year ended
January 30, 1999;
2. Our Quarterly Reports on Form 10-Q for the quarterly
periods ended May 1, 1999, July 31, 1999 and October 31, 1999;
3. Our Current Report on Form 8-K filed on September 9, 1999;
and
4. The description of our class A common stock and other
classes or series of shares set forth in our registration statement on Form S-1,
as amended (File No. 33-34895), and incorporated by reference into the
registration statement on Form 8-A under the Exchange Act, as amended, of our
company filed with the SEC on July 30, 1990.
We will furnish without charge to you, on written or oral
request, a copy of any or all of the documents incorporated by reference,
including exhibits to these documents. You should direct any requests for
documents to Corporate Secretary, The Wet Seal, Inc., 26972 Burbank, Foothill
Ranch, California 92610, telephone: (949) 583-9029.
4
<PAGE>
THE COMPANY
Our company is a specialty retailer of moderately priced,
fashionable, casual apparel designed for women with a young, active lifestyle.
Our company was incorporated on December 19, 1962 in California and was
reincorporated in Delaware on June 26, 1990. Our principal executive offices are
located at 26972 Burbank, Foothill Ranch, California 92610. Our company's
telephone number is (949) 583-9029.
USE OF PROCEEDS
We will not receive any of the proceeds from the sale of the
class A common stock by the selling stockholders.
SELLING STOCKHOLDERS
The shares of class A common stock offered by this prospectus
are being offered by Suzy Shier Equities Inc. and Suzy Shier Limited, both of
which are Canadian corporations. Suzy Shier Equities Inc. is a wholly owned
subsidiary of Suzy Shier Limited, a public company whose shares are traded on
the Montreal and Toronto Stock Exchanges. These companies are controlled,
directly or indirectly, by Irving Teitelbaum, Chairman of the Board, and Stephen
Gross, Secretary and a Director of our company. Messrs. Teitelbaum and Gross are
brothers-in-law.
The table below sets forth information with respect to the
selling stockholders including:
* the name of the selling stockholder;
* the number of shares of class A common stock beneficially
owned by each selling stockholder as of January 15, 2000;
* the number of shares which may be offered and are being
registered by this prospectus for the account of each
selling stockholder; and
* the amount of the class to be owned by each selling
stockholder assuming all of the shares are sold.
<TABLE>
<CAPTION>
Number of Shares of Class Number of Shares of Class Number of Shares of Class
A Common Stock Owned A Common Stock which may A Common Stock to be Owned
be Offered After Offering
<S> <C> <C> <C>
Suzy Shier Limited(1) 58,000 58,000 0
Suzy Shier Equities 290,500 290,500 0
Inc.(1)
___________________
(1) Shares exclude 1,300,000, 155,000, 175,000 and 815,573 shares of class B common stock owned by Los
Angeles Express Fashions, Inc., La Senza Inc., Suzy Shier Equities Inc. and 3254127 Canada Inc. (which
are convertible into shares of class A common stock on a one-for-one basis). Los Angeles Express
Fashions, Inc. is a wholly owned subsidiary of Suzy Shier Equities Inc., and La Senza Inc. and Suzy
Shier Equities Inc. are wholly owned subsidiaries of Suzy Shier Limited, of which Messrs. Teitelbaum and
Gross own 42.2% and 40.0%, respectively. 3254127 Canada Inc. is a wholly owned subsidiary of
Gross-Teitelbaum Holdings Inc., of which Messrs. Teitelbaum and Gross own 50.1% and 49.9%,
respectively. Messrs. Teitelbaum and Gross disclaim beneficial ownership of these shares.
</TABLE>
PLAN OF DISTRIBUTION
Our company is registering the shares of class A common stock
on behalf of the selling stockholders. All costs, expenses and fees in
connection with the registration of the shares offered hereby, and
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<PAGE>
brokerage commissions and similar selling expenses, if any, attributable to the
sale of shares will be borne by the selling stockholders. Sales of shares may be
effected by selling stockholders from time to time in one or more types of
transactions (which may include block transactions) on the Nasdaq National
Market, in the over-the-counter market, in negotiated transactions, through put
or call options transactions relating to the shares, through short sales of
shares, or a combination of such methods of sale, at market prices prevailing at
the time of sale, or at negotiated prices. Such transactions may or may not
involve brokers or dealers. The selling stockholders have advised our company
that they have not entered into any agreements, understandings or arrangements
with any underwriters or broker-dealers regarding the sale of their securities,
nor is there an underwriter or coordinated broker acting in connection with the
proposed sale of shares by the selling stockholders.
The selling stockholders may enter into hedging transactions
with broker-dealers or other financial institutions. In connection with such
transactions, broker-dealers or other financial institutions may engage in short
sales of the shares or of securities convertible into or exchangeable for the
shares in the course of hedging positions they assume with selling stockholders.
The selling stockholders may also enter into options or other transactions with
broker-dealers or other financial institutions which require the delivery to
such broker-dealers or other financial institutions of shares offered by this
prospectus, which shares such broker-dealer or other financial institution may
resell pursuant to this prospectus (as amended or supplemented to reflect such
transaction).
The selling stockholders may effect such transactions by
selling shares directly to purchasers or to or through broker-dealers, which may
act as agents or principals. Such broker-dealers may receive compensation in the
form of discounts, concessions or commissions from selling stockholders and/or
the purchasers of shares for whom such broker-dealers may act as agents or to
whom they sell as principal, or both (which compensation as to a particular
broker-dealer might be in excess of customary commissions).
The selling stockholders and any broker-dealers that act in
connection with the sale of shares might be deemed to be "underwriters" within
the meaning of Section 2(11) of the Securities Act, and any commissions received
by such broker-dealers or any profit on the resale of the shares sold by them
while acting as principals might be deemed to be underwriting discounts or
commissions under the Securities Act. The selling stockholders may agree to
indemnify any agent, dealer or broker-dealer that participates in transactions
involving sales of the shares against certain liabilities, including liabilities
arising under the Securities Act.
Because selling stockholders may be deemed to be
"underwriters" within the meaning of Section 2(11) of the Securities Act, the
selling stockholders will be subject to the prospectus delivery requirements of
the Securities Act. Our company has informed the selling stockholders that the
anti-manipulative provisions of Regulation M promulgated under the Exchange Act
may apply to their sales in the market.
Selling stockholders also may resell all or a portion of the
shares in open market transactions in reliance upon Rule 144 under the
Securities Act, provided they meet the criteria and conform to the requirements
of Rule 144.
Upon our company being notified by a selling stockholder that
any material arrangement has been entered into with a broker-dealer for the sale
of shares through a block trade, special offering, exchange distribution or
secondary distribution or a purchase by a broker or dealer, a supplement to this
prospectus will be filed, if required, pursuant to Rule 424(b) under the
Securities Act, disclosing:
* the name of each such selling stockholder and of the
participating broker-dealer(s);
* the number of shares involved;
the initial price at which such shares were sold;
* the commissions paid or discounts or concessions allowed
to such broker-dealer(s), where applicable;
* that such broker-dealer(s) did not conduct any
investigation to verify the information set out or
incorporated by reference in this prospectus; and
* other facts material to the transactions.
In addition, upon our company being notified by a selling stockholder that a
donee or pledgee intends to sell more than 500 shares, a supplement to this
prospectus will be filed.
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<PAGE>
EXPERTS
The financial statements incorporated in this prospectus by
reference from our Annual Report on Form 10-K for the year ended January 30,
1999 have been audited by Deloitte & Touche LLP, independent auditors, as stated
in their report, which is incorporated by reference in this prospectus, and have
been so incorporated in reliance upon the report of such firm given upon their
authority as experts in auditing and accounting.
LEGAL MATTERS
The validity of the shares of class A common stock offered in
this prospectus will be passed upon for our company by Akin, Gump, Strauss,
Hauer & Feld, L.L.P., New York, New York. Alan Siegel, a director of our
company, is a member of the firm of Akin, Gump, Strauss, Hauer & Feld, L.L.P.
and holds options to purchase 15,000 shares of class A common stock.
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<PAGE>
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
The estimated expenses payable by the registrant in connection with the
issuance and distribution of the securities being registered are as follows:
SEC Registration Fee . . . . . . . . . . . . . . . . . . . . $_______*+
Accounting Fees and Expenses . . . . . . . . . . . . . . . . $_______*+
Legal Fees and Expenses (including Blue Sky) . . . . . . . . $_______*+
Miscellaneous Expenses (printing). . . . . . . . . . . . . . $_______*+
Total. . . . . . . . . . . . . . . . . . . . . . . . . . . $=======*+
_________________
*Estimated
+To be supplied in an amendment.
Item 15. Indemnification of Directors and Officers
Section 145 of the Delaware General Corporation Law permits
indemnification of directors, officers, employees and agents of corporations for
liabilities arising under the Securities Act.
The registrant's certificate of incorporation and bylaws provide for
indemnification of the registrant's directors and officers to the fullest extent
permitted by Section 145 of the Delaware General Corporation Law.
Statutory Provisions
Section 102(b)(7) of the Delaware General Corporation Law enables a
corporation in its certificate of incorporation to eliminate or limit the
personal liability of members of its board of directors to the corporation or
its stockholders for monetary damages for violations of a director's fiduciary
duty of care. The provision would have no effect on the availability of
equitable remedies, such as an injunction or rescission, for breach of fiduciary
duty. In addition, no provision may eliminate or limit the liability of a
director for breaching his duty of loyalty, failing to act in good faith,
engaging in intentional misconduct or knowingly violating a law, paying an
unlawful dividend or approving an illegal stock repurchase, or obtaining an
improper personal benefit.
Section 145 of the Delaware General Corporation Law empowers a
corporation to indemnify any persons who was or is a party to or is threatened
to be made a party to any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or investigative, by reason
of the fact that he is or was a director, officer, employee or agent of the
corporation, against expenses (including attorney's fees), judgments, fines and
amounts paid in settlement actually and reasonably incurred by him in connection
with the action, suit or proceeding if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
corporation, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful. No indemnification shall
be made in respect of any claim, issue or matter as to which such person shall
have been adjudged to be liable to the corporation unless and only to the extent
that the court in which such action or suit was brought shall determine upon
application that, despite the adjudication of liability but in view of all the
circumstances of the case, such person is fairly and reasonably entitled to
indemnity for expenses which the court shall deem proper. Additionally, a
corporation is required to indemnify its directors and officers against expenses
to the extent that the directors or officers have been successful on the merits
or otherwise in any action, suit or proceeding or in defense of any claim, issue
or matter.
An indemnification can be made by the corporation only upon a
determination that indemnification is proper in the circumstances because the
party seeking indemnification has met the applicable standard of conduct as set
forth in the Delaware General Corporation Law. The indemnification provided by
the Delaware General Corporation Law shall not be deemed exclusive of any other
rights to which those seeking indemnification may be entitled under any bylaw,
agreement, vote of stockholders or disinterested directors, or otherwise. A
corporation
II-1
<PAGE>
also has the power to purchase and maintain insurance on behalf of any person,
whether or not the corporation would have the power to indemnify him against
such liability. The indemnification provided by the Delaware General Corporation
Law shall, unless otherwise provided when authorized or ratified, continue as to
a person who has ceased to be a director, officer, employee or agent and shall
inure to the benefit of the heirs, executors and administrators of the person.
The Company's Charter and Bylaw Provisions
Our company's certificate of incorporation limits the director's
liability for monetary damages to our company and its stockholders for breaches
of fiduciary duty except under the circumstances outlined in Section 102(b)(7)
of the Delaware General Corporation Law as described above under "Statutory
Provisions."
Our company's bylaws extend indemnification rights to the fullest
extent authorized by the Delaware General Corporation Law to directors and
officers involved in any action, suit or proceeding where the basis of the
involvement is the person's alleged action in an official capacity or in any
other capacity while serving as a director or officer of our company. In
addition, the bylaws permit our company to maintain insurance to protect itself
and any of its directors, officers, employees or agents against any expense,
liability or loss incurred as a result of any action, suit or proceeding whether
or not our company would have the power to indemnify the person under the
Delaware General Corporation Law.
Indemnification Agreements
Our company has entered into indemnification agreements with each of
its directors and with its Chief Financial Officer that requires our company to
advance expenses for the defense of and to indemnify them to the fullest extent
permitted by applicable law.
Item 16. Exhibits
A list of exhibits included as part of this registration statement is
set forth in the Exhibit Index which immediately precedes the exhibits and is
incorporated by reference here.
Item 17. 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 therein,
and the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
(b) 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 that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(c) The undersigned registrant hereby undertakes that:
(1) For purposes of determining any liability under the
Securities Act of 1933, the information omitted from the form of prospectus
filed as part of this registration statement in reliance upon Rule 430A and
contained in a form of prospectus filed by the registrant pursuant to Rule
424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part
of this registration statement as of the time it was declared effective.
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<PAGE>
(2) For the purposes of determining any liability under
the Securities Act of 1933, each post-effective amendment that contains a form
of prospectus 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.
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 this form of indemnification is against public policy as expressed in
the Securities Act and is, therefore, unenforceable. In the event that a claim
for indemnification against these 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 a director, officer or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Securities
Act and will be governed by the final adjudication of this issue.
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<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Foothill Ranch, State of California, on January 24,
2000.
THE WET SEAL, INC.
(Registrant)
By: /s/ Kathy Bronstein
---------------------------
Kathy Bronstein
Vice Chairman and Chief Executive Officer
By: /s/ Edmond S. Thomas
------------------------
Edmond S. Thomas
President and Chief Operating Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each of the persons whose
signature appears below appoints and constitutes Kathy Bronstein and Edmond S.
Thomas, and each of them, his or her true and lawful attorney-in-fact and agent,
each acting alone, with full power of substitution and resubstitution, for him
and her and in his or her name, place and stead, in any and all capacities, to
execute any and all amendments (including post-effective amendments) to the
within Registration Statement, and to file the same, together with all exhibits
thereto and all other documents in connection therewith, with the Securities and
Exchange Commission and such other agencies, offices and persons as may be
required by applicable law, grant-ing unto each said attorney-in-fact and agent,
each acting alone, full power and authority to do and perform each and every act
and thing requisite or necessary to be done in and about the premises, as fully
to all intents and purposes as he or she might or could do in person, hereby
ratifying and confirming all that each said attorney-in-fact and agent, each
acting alone may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
<S> <C> <C>
/s/ Irving Teitelbaum Chairman of the Board and Director January 24, 2000
-------------------------
Irving Teitelbaum
/s/ Kathy Bronstein Vice Chairman and Chief Executive January 24, 2000
------------------------
Kathy Bronstein Officer and Director (Principal
Executive Officer)
/s/ Edmond S. Thomas President and Chief Operating January 24, 2000
------------------------
Edmond S. Thomas Officer and Director
/s/ Ann Cadier Kim Vice President of Finance and Chief January 24, 2000
-----------------------
Ann Cadier Kim Financial Officer (Principal
Financial and Accounting Officer)
/s/ Stephen Gross Secretary and Director January 24, 2000
----------------------
Stephen Gross
January 24, 2000
/s/ George H. Benter, Jr. Director
----------------------
George H. Benter, Jr.
January 24, 2000
/s/ Walter F. Loeb Director
----------------------
Walter F. Loeb
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<PAGE>
/s/ Wilfred Posluns Director January 24, 2000
----------------------
Wilfred Posluns
/s/ Gerald Randolph Director January 24, 2000
----------------------
Gerald Randolph
/s/ Alan Siegel Director January 24, 2000
----------------------
Alan Siegel
</TABLE>
II-5
<PAGE>
EXHIBIT INDEX
Sequentially
Exhibit Numbered
Number Exhibit Page
3.1* Certificate of Incorporation of the Company.
3.2* By-laws of the Company, as amended.
4.1* Specimen certificate of the Class A Common Stock.
5.1** Opinion of Akin, Gump, Strauss, Hauer & Feld, L.L.P.
23.1** Consent of Akin, Gump, Strauss, Hauer & Feld, L.L.P.
(included in Exhibit 5.1).
23.2(a)** Consent of Deloitte & Touche LLP.
24.1** Power of Attorney (included on the signature page of the
Registration Statement).
--------------------
* Incorporated by reference from the Registrant's
Registration Statement on Form S-1 (File No. 33-34895)
** Filed herewith.
[LOGO OF AKIN, GUMP, STRAUSS, HAUER & FELD, L.L.P.]
January 21, 2000
Board of Directors
The Wet Seal, Inc.
26972 Burbank
Foothill Ranch, California 92610
Re: Registration Statement on Form S-3
Ladies and Gentlemen:
In connection with the Registration Statement on Form S-3 (the
"Registration Statement") to be filed by The Wet Seal, Inc. (the "Company") with
the Securities and Exchange Commission on or about January 21, 2000 pursuant to
the Securities Act of 1933, as amended (the "Act"), you have requested that we
furnish to you our opinion as to the legality of the 348,500 shares of Class A
Common Stock, $.10 par value per share (the "Class A Common Stock"), being
registered under the Registration Statement and being offered by the
stockholders of the Company named in the section entitled "Selling Stockholders"
in the Registration Statement (the "Selling Stockholders").
We have examined and are familiar with originals or copies,
certified or otherwise identified to our satisfaction, of such corporate
documents of the Company, certificates of public officials and certificates of
officers of the Company and such other documents and agreements and records and
papers as we have deemed necessary or appropriate in order to render this
opinion.
In our examination, we have assumed the authenticity of all
documents submitted to us as originals and the conformity to original documents
of all documents submitted to us as certified or photostatic copies.
Based upon and subject to the foregoing, we are of the opinion
that the shares of Class A Common Stock being offered by the Selling
Stockholders have been duly and validly authorized and, when the Registration
Statement shall have become effective, and when the Class A Common Stock being
offered by the Selling Stockholders pursuant thereto have been sold for good and
valuable consideration upon the terms and conditions described in the
<PAGE>
Registration Statement, such Class A Common Stock will be duly and validly
issued, fully paid and non-assessable.
This law firm is a registered limited liability partnership
organized under the laws of the State of Texas. Our opinion relates only to the
laws of the State of New York and the federal law of the United States of
America. We express no opinion as to the law of any other jurisdiction.
This opinion is limited to the matters stated herein, and no
opinion is implied or may be inferred beyond the matters expressly stated. We
assume herein no obligation, and hereby disclaim any obligation, to make any
inquiry after the date hereof or to advise you of any future changes in the
foregoing or of any facts or circumstances that may hereafter come to our
attention.
We hereby consent to the filing of this opinion as Exhibit 5.1
to the Registration Statement and to the reference to this firm under the
caption "Legal Matters" in the Prospectus forming a part of the Registration
Statement. In giving such consent, we do not hereby admit that we come within
the category of persons whose consent is required under Section 7 of the
Securities Act or the rules and regulations of the Securities and Exchange
Commission thereof.
Very truly yours,
/s/ Akin, Gump, Strauss, Hauer & Feld, L.L.P.
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement of
The Wet Seal, Inc. on Form S-3 of our report dated March 12, 1999, appearing in
the Annual Report on Form 10-K of The Wet Seal, Inc. for the year ended January
30, 1999, and to the reference to us under the heading "Experts" in the
Prospectus, which is part of this Registration Statement.
/s/ Deloitte & Touche LLP
- ------------------------------
DELOITTE & TOUCHE LLP
Costa Mesa, California
January 20, 2000
