AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JULY 23, 2002
REGISTRATION NO. 333-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
CANDIE'S, INC.
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(Exact name of registrant as specified in its charter)
Delaware 11-2481903
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(State or other jurisdiction of Incorporation) (I.R.S. Employer
Identification No.)
400 Columbus Avenue
Valhalla, New York 10595
(914) 769-8600
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(Address, including Zip code, and telephone number, including area
code, of Registrant's principal executive offices)
Neil Cole, Chief Executive Officer
Candie's, Inc.
400 Columbus Avenue
Valhalla, New York 10595
(914) 769-8600
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(Name, address, including Zip code, and telephone number,
including area code, of agent for service)
Copies to:
Robert J. Mittman, Esq.
Ethan Seer, Esq.
Blank Rome Tenzer Greenblatt LLP
405 Lexington Avenue
New York, New York 10174
Telephone (212 885-5000
Facsimile: (212) 885-5001
Approximate date of proposed commencement of sale to public: As soon as
practicable after this Registration Statement becomes effective.
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, please 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, check the following box and list the
Securities Act registration statement number of the earlier registration
statement for the same offering.
[-]
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 for the same
offering. [_]
If delivery of the prospectus is expected to be made pursuant to Rule 434, check
the following box. [_]
Calculation of Fee
----------------------------- ------------------- --------------------------- --------------------------- -------------------
Title of Shares to Amount to be Proposed Maximum Proposed Maximum Amount of
be Registered Registered Aggregate Price Per Unit Aggregate Offering Price Registration Fee
----------------------------- ------------------- --------------------------- --------------------------- -------------------
Common Stock $.001 3,000,000 (3) $ 3.92 (4) $ 11,760,000 (4) $
par value (1)(2) 1,081.92
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(1) Represents shares to be sold by the selling stockholder.
(2) Includes preferred share purchase rights. Prior to the occurrence of
certain events, the preferred share purchase rights will not be
evidenced separately from the Common Stock.
(3) Pursuant to Rule 416 of the Securities Act of 1933, there are also
being registered such additional shares as may be offered or issued to
the selling stockholders to prevent dilution resulting from stock
dividends, stock splits or similar transactions.
(4) Estimated solely for purpose of calculating the registration fee.
Pursuant to Rule 457(c) of the Securities Act of 1933, as amended, the
registration fee has been calculated based upon the average of the high
and low prices, as reported by Nasdaq, for the registrant's Common
Stock as of July 18, 2002.
The Registrant hereby amends this Registration Statement on such 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, as amended, or until the Registration Statement shall
become effective on such date as the Commission, acting pursuant to said Section
8(a), may determine.
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.
Subject to Completion, Dated July 23, 2002
PROSPECTUS
CANDIE'S, INC.
3,000,000 shares of Common Stock
The selling stockholder listed on page 7 of this prospectus is offering
for resale up to 3,000,000 shares of common stock beneficially owned by it. The
common stock may be offered from time to time by the selling stockholder through
ordinary brokerage transactions in the over-the-counter markets, in negotiated
transactions or otherwise, at market prices prevailing at the time of sale or at
negotiated prices and in other ways as described in the "Plan of Distribution".
We will not receive any of the proceeds from the sale of the shares by
the selling stockholder.
Our common stock is listed on the Nasdaq National Market under the
symbol "CAND" On July 22, 2002, the last sale price of our common stock as
reported by Nasdaq was $3.269 per share.
Investing in our common stock involves a high degree of risk. For more
information, see "Risk Factors" beginning on page 3.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if this
prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
The date of this prospectus is ________, 2002
1
Table of Contents
Page
Forward-looking Statements................................................... 3
The Company.................................................................. 3
Risk Factors................................................................. 3
Use of Proceeds.............................................................. 7
Selling Stockholder.......................................................... 8
Plan of Distribution......................................................... 8
Legal Matters................................................................11
Experts......................................................................11
Where You Can Find More Information..........................................11
Incorporation of Certain Documents by Reference..............................12
2
Forward-looking Statements
Certain statements in this Registration Statement or the documents
incorporated by reference in this Registration Statement constitute
"forward-looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995. These forward-looking statements involve known
and unknown risks, uncertainties and other factors which may cause the actual
results, performance or achievements of Candie's, Inc. to be materially
different from any future results, performance or achievements expressed or
implied by such forward-looking statements. Such factors include, among others,
those set forth under the caption "Risk Factors." The words "believe," "expect,"
"anticipate," "intend," and "plan" and similar expressions identify
forward-looking statements. Readers are cautioned not to place undue reliance on
any of these forward-looking statements, which speak only as of the date of the
statement was made. Candie's undertakes no obligation to update any
forward-looking statement.
The Company
Candie's is engaged primarily in the design, marketing and distribution
of moderately-priced women's casual and fashion footwear under the CANDIE'S(R)
and BONGO(R) trademarks, for distribution within the United States to
department, specialty, chain and thirteen Candie's-owned retail stores, through
the Candie's web site and to specialty stores internationally.
Candie's was incorporated under the laws of the State of Delaware in
1978. Its principal executive offices are located at 400 Columbus Drive,
Valhalla, New York 10595, and its telephone number is (914) 769-8600.
Unless the context requires otherwise, reference in this prospectus to
"we", "us" ,"our", "Candie's", or "Company" refers to Candie's, Inc. and its
subsidiaries.
Risk Factors
We operate in a changing environment that involves numerous known and
unknown risks and uncertainties that could materially adversely affect our
operations. The following highlights some of the factors that have affected, and
in the future could affect, our operations.
We have incurred losses during recent fiscal years.
We sustained net losses of $2,282,000, $8,200,000 and $25,176,000
during our fiscal years ended January 31, 2002, 2001 and 2000, respectively. We
cannot guarantee that we will not incur substantial losses in the future.
Moreover, future losses could jeopardize our ability to comply with certain
financial covenants contained in agreements with our primary commercial lenders.
If we were to violate any such covenants the lenders could accelerate any of our
outstanding loans.
3
Our business is dependent on continued market acceptance of our products and of
the CANDIE'S(R) and BONGO(R) trademarks.
Our ability to achieve continued market acceptance of our existing
products or market acceptance of any future products that may be offered by us
is subject to a high degree of uncertainty. Our ability to achieve market
acceptance by new customers or continued market acceptance by existing or past
customers will require substantial additional marketing efforts and the
expenditure of significant funds by us to create a demand for such products. Our
additional marketing efforts and expenditures may not result in either increased
market acceptance of our products or increased sales. We are materially
dependent on the sale of products bearing the CANDIE'S(R) and BONGO(R)
trademarks for a significant portion of our revenues. A failure of our
CANDIE'S(R) or BONGO(R) trademarks or products to achieve or maintain market
acceptance would have a material adverse effect on us.
Our business is dependent upon our ability to secure and maintain adequate
financing to satisfy our significant capital requirements and other obligations.
The manufacture and sale of our products requires that we obtain a
significant amount of capital. We are substantially dependent on financing from
the arrangement with our factor in order to finance our working capital
requirements. We will require financing should we seek to expand our business
operations including, but not limited to, an expansion of our retail operations.
In addition, in connection with our acquisition in April 2002 from Sweet
Sportswear LLC ("Sweet") of the remaining 50% interest in Unzipped Apparel LLC
("Unzipped"), a joint venture that we previously had formed with Sweet, we will
be issuing to Sweet $11.0 million of redeemable preferred stock or principal
amount of senior subordinated notes that will mature in 2012. In addition, by
February 1, 2003 we will be required to pay off certain Unzipped indebtedness
which, as of July 2002, aggregated approximately $21.1 million. Moreover, in the
event that projected cash flow proves to be insufficient to satisfy our cash
requirements, we may be required to seek additional funds through, among other
means, public or private equity or debt financing, which may result in dilution
to our stockholders. Our failure to obtain any required additional financing on
terms acceptable to us, or at all, could have a material adverse effect upon our
business.
A recession in the fashion industry or rapidly changing fashion trends could
harm our operating results.
The fashion industry is cyclical, with purchases of apparel and related
goods tending to decline during recessionary periods when disposable income is
low. A poor general economic climate could have a negative impact on our ability
to compete for limited consumer resources. Moreover, our future success depends
in substantial part on our ability to anticipate and respond to changing
consumer demands and fashion trends in a timely manner. The footwear and wearing
apparel industries are generally subject to constantly changing fashion trends.
If we misjudge the market for a particular product or product line, it may
result in an increased inventory of unsold and outdated finished goods, which
may have an adverse effect on our business.
4
We rely on unaffiliated manufacturers and suppliers.
We do not own or operate any manufacturing facilities. All of our
footwear and wearing apparel products are manufactured to our specifications by
our suppliers (either directly or through third party manufacturers on a
subcontract basis). We have no manufacturing or supply contracts with any of the
manufacturers or suppliers of footwear products, therefore, any or all of these
companies could terminate their relationship with us at any time. In addition,
the manufacturers of our products have limited production capacity and may not,
in all instances, have the capability to satisfy our manufacturing requirements.
In such event, the capacity of alternative manufacturing sources may not be
available to us on a cost effective basis. Accordingly, our dependence upon
third parties for the manufacture of our products could have an adverse effect
on our ability to deliver products on a timely and competitive basis and could
have an adverse effect on our operations.
In addition, most raw materials necessary for the manufacture of our
footwear are purchased by the manufacturers from suppliers located in the
country of manufacture. We do not maintain contractual relationships with any of
these suppliers and our inability to obtain raw materials could harm our
operations.
Moreover, we operate under substantial time constraints which require
us to have production orders in place at specified times in advance of its
customers' retail selling seasons. If our suppliers fail to meet their delivery
date requirements pursuant to purchase orders with us, we will be unable to meet
our delivery date requirements pursuant to purchase orders with our customers.
This could result in the cancellation of purchase orders both by us and our
customers, having an adverse effect on our revenues and earnings.
We are subject to risks and uncertainties of foreign manufacturing.
Substantially all of our products are manufactured overseas. We are subject to
various risks inherent in foreign manufacturing, including:
o increased credit risks;
o increased tariffs and duties;
o fluctuations in foreign currency exchange rates;
o shipping delays; and
o international political, regulatory and economic developments, all of
which can have a significant impact on our operating results.
We also import certain finished products and assume all risk of loss
and damage once our suppliers ship these goods. If these goods were destroyed or
damaged during shipment it could adversely effect our operations and financial
position.
5
We face intense competition in our markets.
The footwear and apparel industries are extremely competitive in the
United States and we face intense and substantial competition in each of our
product lines. In general, competitive factors include quality, price, style,
name recognition and service. In addition, the presence in the marketplace of
various fads and the limited availability of shelf space can affect competition.
Many of our competitors have greater financial, distribution, marketing and
other resources than we have and have achieved significant name recognition for
their brand names. There can be no assurance that we will be able to continue to
compete successfully.
We may not be able to protect our proprietary rights or avoid claims that we
infringe on the proprietary rights of others.
We own federal trademark registrations for CANDIE'S(R) and BONGO(R),
among others, and believe that our CANDIE'S(R) trademark and our BONGO(R)
trademark have significant value and are important to the marketing of our
products. There can be no assurance that CANDIE'S(R), BONGO(R) or other
trademarks owned or used by us do not or will not violate the proprietary rights
of others, that they would be upheld if challenged or that we would not, in such
an event, be prevented from using the trademarks, any of which events could have
an adverse effect on us. In addition, there can be no assurance that we will
have the financial resources necessary to enforce or defend trademarks owned or
used by us.
We are dependent upon our key executives and other personnel.
Our success of is largely dependent upon the efforts of Neil Cole, our
President, Chief Executive Officer and Chairman. Although we have entered into
an employment agreement with Mr. Cole, expiring in January 2005, the loss of his
services would have a material adverse effect on our business and prospects. Our
success is also dependent upon our ability to hire and retain additional
qualified sales and marketing personnel in connection with the design, marketing
and distribution of our products as well as our ability to hire and retain
administrative personnel. There can be no assurance that we will be able to hire
or retain such necessary personnel.
Provisions in our charter and share purchase rights plan may prevent an
acquisition of Candie's.
Certain provisions of our Certificate of Incorporation and our Share
Purchase Rights Plan could have the effect, either alone or in combination with
each other, of making more difficult, or discouraging an acquisition of our
company deemed undesirable by our Board of Directors. Our Certificate of
Incorporation provides for the issuance of up to 75,000,000 shares of common
stock and 5,000,000 shares of preferred stock. As of June 30, 2002 there were
approximately 24,000,000 shares of common stock and no shares of preferred stock
outstanding. Additional shares of our common stock and preferred stock are
therefore available for future issuance without stockholder approval. The Share
Purchase Rights Plan, commonly known as a "poison pill," states that, in the
event than an individual or entity acquires 15% of the outstanding shares of our
company, stockholders other than the acquiror may purchase additional shares of
our common stock for a fixed price. The existence of authorized but unissued
capital stock, together with the existence of the Share Purchase Rights Plan,
could have the effect of discouraging an acquisition of our company.
6
We are subject to certain litigation and regulatory matters that could harm us.
We currently are defendants in a breach of contract action commenced
against us by one of our former buying agents that also supplied us with certain
footwear. Our financial condition could be harmed if we were required to pay the
monetary damages sought by the plaintiff. Moreover, in August 1999 the staff of
the Securities and Exchange (SEC) advised us that it had commenced a formal
investigation into our actions and the actions of others in connection with,
among other things, certain accounting issues. We could be harmed if the SEC
decides to take any action against us as a result of the matters that are
subject of the SEC investigation.
We do not expect to pay dividends on our common stock.
We have not paid any cash dividends on our common stock to date and do
not expect to pay dividends for the foreseeable future. Under existing loan
agreements with our principal lender, we are not permitted to pay dividends
without the lender's consent.
The market price of our common stock may be volatile.
The market price of the common stock may be highly volatile.
Disclosures of our operating results, announcements of various events by us or
our competitors and the development and marketing of new products affecting our
industry may cause the market price of our common stock to change significantly
over short periods of time. Sales of shares under this prospectus may have a
depressive effect on the market price of our common stock.
Future sales of shares of our common stock could affect the market price of our
common stock and our ability to raise additional capital.
We have previously issued a substantial number of shares of common
stock, which are eligible for resale under Rule 144 of the Securities Act, and
may become freely tradable. We will also be required to issue additional shares
of common stock in 2002 pursuant to the terms of our settlement of a prior class
action litigation brought against us. We have also registered a substantial
number of shares of common stock that are issuable upon the exercise of options
and warrants. If holders of options or warrants choose to exercise their
purchase rights and sell shares of common stock in the public market, or if
holders of currently restricted shares or the shares previously issued or to be
issued in connection with the settlement of the prior class action litigation
choose to sell such shares in the public market under Rule 144 or otherwise, the
prevailing market price for the common stock may decline. Future public sales of
shares of common stock may adversely affect the market price of our common stock
or our future ability to raise capital by offering equity securities.
Use of Proceeds
We will not receive any proceeds from the sale by the selling
stockholder named in this prospectus.
7
We have agreed to pay expenses in connection with the registration of
the shares being offered by the selling stockholder.
Selling Stockholder
Based on information provided by the selling stockholder, the following
table sets forth certain information regarding the selling stockholder:
The table below assumes for calculating the stockholder's beneficial
and percentage ownership that options, warrants or convertible securities that
are held by such stockholder (but not held by any other person) and are
exercisable within 60 days from the date this prospectus have been exercised and
converted. The table also assumes the sale of all of the shares being offered.
Common Stock Beneficially
Owned After the Offering
Number of Shares of ---------------------------
Common Stock Percent of
Beneficially Owned Shares Number Outstanding
Selling Security Holder Prior to the Offering Being Offered of Shares Shares
----------------------- --------------------- ------------- --------- -----------
Sweet Sportswear, LLC(1) 3,000,000 3,000,000 0 0
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(1) Voting and investment control over the shares owned of record by Sweet
is held by Mr. Hubert Guez, a director of the Company. The shares are
subject to an agreement in which Sweet has agreed to vote the shares as
directed by the Company's Board of Directors. On April 23, 2002 the
Company acquired from Sweet the remaining 50% equity interest in
Unzipped, a joint venture previously formed by the Company and Sweet.
Sweet has agreed not to sell any of the 3,000,000 shares without the
Company's consent until April 23, 2003 and to retain at least a minimum
of 1,000,000 shares until at least the beginning of the third year of a
management agreement that the Company and Sweet intend to enter into
that provides for Sweet to manage Unzipped for a three year period. In
connection with the acquisition transaction the Company issued to Sweet
the 3,000,000 shares of common stock being offered hereby by Sweet and
agreed to issue to Sweet $11.0 million of redeemable preferred stock.
In lieu of issuing the preferred stock the parties are discussing the
possible issuance by the Company to Sweet of $11.0 million of senior
subordinated notes due 2012.
Plan of Distribution
We have been advised that the selling stockholder, which may include
pledgees, donees, transferees or other successors-in-interest who have received
shares from a selling stockholder after the date of this prospectus, may from
time to time, sell all or a portion of the shares in privately negotiated
transactions or otherwise, at fixed prices that may be changed, at market prices
prevailing at the time of sale, at prices related to these market prices or at
negotiated prices.
8
All costs, expenses and fees in connection with the registration of the
shares offered by this prospectus shall be borne by us. Brokerage costs, if any,
attributable to the sale of shares will be borne by the selling stockholder
The shares may be sold by the selling stockholder by one or more of the
following methods:
block trades in which the broker or dealer so engaged will
attempt to sell the shares as agent but may position and resell a
portion of the shares as principal to facilitate the transaction;
purchases by a broker or dealer as principal and resale by such
broker dealer for its account pursuant to this prospectus;
an exchange distribution in accordance with the rules of the
applicable exchange;
ordinary brokerage transactions and transactions in which the
broker solicits purchasers;
through put and call options relating to the shares;
negotiated transactions;
a combination of any such methods of sale at market prices
prevailing at the time of the sale or at negotiated prices; and
any other method permitted pursuant to applicable law.
The transactions described above may or may not involve brokers or
dealers.
A selling stockholder will not be restricted as to the price or prices
at which the selling stockholder may sell its shares. Sales of shares by the
selling stockholder may depress the market price of our common stock since the
number of shares which may be sold by the selling stockholder is relatively
large compared to the historical average weekly trading of our common stock.
Accordingly, if the selling stockholder were to sell, or attempt to sell, all of
such shares at once or during a short time period, we believe such a transaction
could adversely affect the market price of our common stock.
From time to time a selling stockholder may pledge its shares under
margin provisions of customer agreements with its brokers or under loans with
third parties. Upon a default by the selling stockholder, the broker or such
third party may offer and sell any pledged shares from time to time.
9
In effecting sales, brokers and dealers engaged by a selling
stockholder may arrange for other brokers or dealers to participate in the sales
as agents or principals. Brokers or dealers may receive commissions or discounts
from the selling stockholder or, if the broker-dealer acts as agent for the
purchaser of such shares, from the purchaser in amounts to be negotiated, which
compensation as to a particular broker dealer might be in excess of customary
commissions which are not expected to exceed those customary in the types of
transactions involved. Broker-dealers may agree with the selling stockholder to
sell a specified number of such shares at a stipulated price per share, and to
the extent the broker-dealer is unable to do so acting as agent for a selling
stockholders, to purchase as principal any unsold shares at the price required
to fulfill the broker-dealer commitment to the selling stockholder.
Broker-dealers who acquire shares as principal may then resell those shares from
time to time in transactions
in the over-the counter market or otherwise;
at prices and on terms prevailing at the time of sale;
at prices related to the then-current market price; or
in negotiated transactions.
These resales may involve block transactions or sales to and through
other broker-dealers, including any of the transactions described above. In
connection with these sales, these broker-dealers may pay to or receive from the
purchasers of those shares commissions as described above. The selling
stockholder may also sell the shares in open market transactions under Rule 144
under the Securities Act, rather than under this prospectus.
The selling stockholder and any broker-dealers or agents that
participate with the selling stockholder in sales of the shares may be deemed to
be "underwriters" within the meaning of the Securities Act in connection with
these sales. In this event, any commissions received by these broker-dealers or
agents and any profit on the resale of the shares purchased by them may be
deemed to be underwriting commissions or discounts under the Securities Act.
We have agreed to indemnify the selling stockholder against certain
liabilities under the Securities Act. The selling stockholder 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.
The selling stockholder is subject to applicable provisions of the
Securities Exchange Act of 1934 and the SEC's rules and regulations, including
Regulation M, which provisions may limit the timing of purchases and sales of
the shares by the selling stockholder.
In order to comply with certain states' securities laws, if applicable,
the shares may be sold in those jurisdictions only through registered or
licensed brokers or dealers. In certain states the shares may not be sold unless
the shares have been registered or qualified for sale in such state, or unless
an exemption from registration or qualification is available and is obtained.
10
Legal Matters
Blank Rome Tenzer Greenblatt LLP of New York, New York will pass upon
the validity of the shares of common stock being offered by this prospectus.
Experts
The financial statements and schedule of Candie's, Inc. incorporated in
this prospectus by reference from Candie's, Inc.'s Annual Report on Form 10-K
for the year ended January 31, 2002 have been audited by BDO Seidman, LLP,
independent certified public accountants. The financial statements and schedule
referred to above have been so incorporated by reference herein in reliance upon
the reports of such firm given upon its authority as experts in accounting and
auditing.
Ernst & Young LLP, independent auditors, have audited the financial
statements of Unzipped Apparel LLC included in the Candie's, Inc. Current Report
on Form 8-K/A for the event dated April 23, 2002, as set forth in their report,
which is incorporated by reference in this prospectus and elsewhere in the
registration statement. The financial statements of Unzipped Apparel LLC are
incorporated by reference in reliance on Ernst & Young LLP's report, given on
their authority as experts in accounting and auditing.
Where You Can Find More Information
We are subject to the informational requirements of the Securities
Exchange Act of 1934 and we file reports and other information with the SEC.
You can read reports and other information filed by us with the SEC
without charge and copy such reports and information at the public reference
facilities maintained by the SEC at the following address:
Chicago Regional Office, 500 West Madison Street, Suite 1400,
Chicago, 60661-2511.
You may read and copy any of the reports, statements, or other
information we file with the SEC at the SEC's Public Reference Section at 450
Fifth Street, N.W., Washington, D.C. 20549 at prescribed rates. Information on
the operation of the Public Reference Room may be obtained by calling the SEC at
1-800-SEC-0330. The SEC maintains a Web site at http://www.sec.gov that contains
reports, proxy statements and other information regarding issuers that file
electronically with the SEC. The Nasdaq Stock Market maintains a Web site at
http://www.nasdaq.com that contains reports, proxy statements and other
information filed by us.
Our common stock is listed on The Nasdaq National Market under the
symbol "CAND".
11
Incorporation of Certain Documents By Reference
We have filed with the SEC, Washington, D.C., a registration statement
on Form S-3 under the Securities Act of 1933, covering the securities offered by
this prospectus. This prospectus does not contain all of the information that
you can find in our registration statement and the exhibits to the registration
statement. Statements contained in this prospectus as to the contents of any
contract or other document referred to are not necessarily complete and in each
instance such statement is qualified by reference to each such contract or
document filed or incorporated by reference as an exhibit to the registration
statement.
The SEC allows us to "incorporate by reference" the information we file
with them. This means that we can disclose important information to you by
referring you to other documents that are legally considered to be part of this
prospectus, and later information that we file with the SEC will automatically
update and supersede the information in this prospectus and the documents listed
below. We incorporate by reference the documents listed below, and any future
filings made with the SEC under Section 13(a), 13(c), 14 or 15(d) of the
Securities Exchange Act of 1934 until the selling stockholders sell all the
shares.
1. Our Annual Report on Form 10-K for the fiscal year ended January 31, 2002;
2. The description of our common stock and our preferred share purchase rights
contained in our registration statements on Form 8-A filed with the SEC and
any amendments thereto;
3. Our Current Report on Form 8-K for the event dated April 23, 2002;
4. Our Quarterly Report on Form 10-Q for the quarter ended April 30, 2002;
5. Our amendment to our Current Report on Form 8-K/A (Amendment No. 1) for the
event dated April 23, 2002;
6. All documents filed by us pursuant to Sections 13(a), 13(c), 14 or 15(d) of
the Securities Exchange Act of 1934 subsequent to the date of this
prospectus and prior to the termination of this offering, except the
Compensation Committee Report on Executive Compensation and the performance
graph included in any Proxy Statement filed by us pursuant to Section 14 of
the Exchange Act; and
7. All documents filed by us pursuant to Section 13(a), 13(c), 14 or 15(d) of
the Securities Exchange Act of 1934 subsequent to the date of the initial
filing of this registration statement and prior to the effectiveness of
this registration statement.
You may request a copy of these filings, other than the exhibits, by
writing or telephoning us at Candie's, Inc., 400 Columbus Drive, Valhalla, New
York 10595, telephone number (914) 769-8600.
We have not authorized anyone else to provide you with information
different from that contained or incorporated by reference in this prospectus.
This prospectus is not an offer to sell nor is it a solicitation of an offer to
buy any security in any jurisdiction where the offer or sale is not permitted.
Neither the delivery of this prospectus nor any sale made under this prospectus
shall, under any circumstances, imply that there has been no change in our
affairs since the date of this prospectus or that the information contained in
this prospectus or incorporated by reference herein is correct as of any time
subsequent to its date.
12
Candie's, Inc.
3,000,000 shares of Common Stock
Prospectus
_________, 2002
13
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The expenses payable by the Registrant in connection with the issuance
and distribution of the securities being registered (estimated except for the
SEC Registration fee)are as follows:
SEC Registration Fee $1,081.92
Accounting Fees and Expenses $10,000.00
Legal Fees and Expenses $10,000.00
Miscellaneous Expenses $3,918.08
Total $25,000.00
Item 15. Indemnification of Directors and Officers.
Section 145 of the General Corporation Law of the State of Delaware
("GCL") provides for the indemnification of officers and directors under certain
circumstances against expenses incurred in successfully defending against a
claim and authorizes Delaware corporations to indemnify their officers and
directors under certain circumstances against expenses and liabilities incurred
in legal proceedings involving such persons because of their being or having
been an officer or director.
Section 102(b) of the GCL permits a corporation, by so providing in its
certificate of incorporation, to eliminate or limit director's liability to the
corporation and its shareholders for monetary damages arising out of certain
alleged breaches of their fiduciary duty. Section 102(b)(7) of the GCL provides
that no such limitation of liability may affect a director's liability with
respect to any of the following: (i) breaches of the director's duty of loyalty
to the corporation or its shareholders; (ii) acts or omissions not made in good
faith or which involve intentional misconduct of knowing violations of law;
(iii) liability for dividends paid or stock repurchased or redeemed in violation
of the GCL; or (iv) any transaction from which the director derived an improper
personal benefit. Section 102(b)(7) does not authorize any limitation on the
ability of the corporation or its shareholders to obtain injunctive relief,
specific performance or other equitable relief against directors.
Article Ninth of the registrant's Certificate of Incorporation and the
registrant's By-laws provide that all persons who the registrant is empowered to
indemnify pursuant to the provisions of Section 145 of the GCL (or any similar
provision or provisions of applicable law at the time in effect), shall be
indemnified by the registrant to the full extent permitted thereby. The
foregoing right of indemnification shall not be deemed to be exclusive of any
other rights to which those seeking indemnification may be entitled under any
by-law, agreement, vote of shareholders or disinterested directors, or
otherwise.
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Article Tenth of the registrant's Certificate of Incorporation provides
that no director of the registrant shall be personally liable to the registrant
or its stockholders for any monetary damages for breaches of fiduciary duty as a
director, except for liability (i) for any breach of the director's duty of
loyalty to the registrant or its stockholders; (ii) for acts or omissions not in
good faith or which involve intentional misconduct or a knowing violation of
law; (iii) under Section 174 of the GCL; or (iv) for any transaction from which
the director derived an improper personal benefit.
The registrant's employment agreements with Mr. Neil Cole, the
registrant's Chief Executive Officer and Ms. Deborah Sorell Stehr, the
registrant's Senior Vice President and General Counsel provide that the
registrant shall indemnify each of them for the consequences of all acts and
decisions made by such person while performing services for the registrant.
These agreements also require the registrant to use its best efforts to obtain
directors' and officers' liability insurance for such persons.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the registrant pursuant to the foregoing provisions or otherwise, the registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Securities Act
and is, therefore, unenforceable.
Item 16. Exhibits.
5 Opinion of Blank Rome Tenzer Greenblatt LLP
23.1 Consent of BDO Seidman, LLP
23.2 Consent of Ernst & Young, LLP
23.3 Consent of Blank Rome Tenzer Greenblatt LLP (included in Exhibit
5)
24 Power of Attorney (included on the signature page of the
Registration Statement)
Item 17. Undertakings
Undertaking Required by Regulation S-K, Item 512(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:
i. To include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933, as amended (the "Securities
Act");
ii. To reflect in the prospectus any facts or events arising
after the effective date of the Registration Statement (or
the most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental
change in the information set forth in the Registration
Statement;
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iii. 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;
provided, however, that clauses (i) and (ii) do not apply if the Registration
Statement is on Form S-3, Form S-8 or Form F-3, and the information required to
be included in a post-effective amendment by such clauses is contained in
periodic reports filed with or furnished to the Commission by the Registrant
pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the Registration Statement;
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering 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.
Undertaking Required by Regulation S-K, Item 512(b).
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
registrant's annual report pursuant to Section 13(a) or 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 initial bona fide offering thereof.
Undertaking required by Regulation S-K, Item 512(h).
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers or controlling persons pursuant to
the foregoing provisions, or otherwise, the registrant has been advised that in
the opinion of the Securities and Exchange Commission such indemnification is
against public policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the registrant of expenses incurred or
paid by a director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
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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 New York, State of New York, on the 23rd day of July
2002.
CANDIE'S, INC.
By:/s/Neil Cole
--------------------------------------
Neil Cole
President and Chief Executive Officer
Each person whose signature appears below authorizes each of Neil Cole
and Richard Danderline, or either of them acting individually, as his true and
lawful attorney-in-fact, each with full power of substitution, to sign the
Registration Statement on Form S-3 of Candie's, Inc., including any and all
pre-effective and post-effective amendments, in the name and on behalf of each
such person, individually and in each capacity stated below, and to file the
same, with exhibits thereto and other documents in connection therewith with the
Securities and Exchange Commission.
In accordance with the requirements of the Securities Act of 1933, this
Registration Statement was signed by the following person in the capacities and
on the dates stated.
Signature Title Date
--------- ----- ----
/s/Neil Cole Chief Executive Officer, President and July 23, 2002
--------------------- Director (Principal Executive Officer)
Neil Cole
/s/Richard Danderline
--------------------- Executive Vice President of Operations and July 23, 2002
Richard Danderline Finance (Principal Financial and Accounting
Officer)
/s/Barry Emanuel Director July 23, 2002
---------------------
Barry Emanuel
/s/Steven Mendelow Director July 23, 2002
---------------------
Steven Mendelow
Director July __, 2002
---------------------
Peter Siris
/s/Ann Iverson Director July 23, 2002
---------------------
Ann Iverson
/s/Hubert Guez Director July 23, 2002
---------------------
Hubert Guez
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