STOCK PURCHASE AGREEMENT
by and among
RUNWAY ACQUISITION SUB, INC.
and
THE STOCKHOLDERS OF BLUEFLY, INC.
LISTED ON THE SIGNATURE PAGES HERETO
May 23, 2013
TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS..............................................1
ARTICLE II TRANSACTIONS AT THE CLOSING..............................4
Section 2.1 Purchase and Sale of Shares..............................4
Section 2.2 Closing; Closing Deliveries..............................4
ARTICLE III REPRESENTATIONS AND WARRANTIES CONCERNING SELLERS........5
Section 3.1 Organization and Qualification...........................5
Section 3.2 Authority; No Conflict...................................5
Section 3.3 Ownership................................................6
Section 3.4 Access to Information....................................6
ARTICLE IV REPRESENTATIONS AND WARRANTIES CONCERNING PURCHASER......6
Section 4.1 Organization and Qualification...........................6
Section 4.2 Authority; No Conflict...................................6
Section 4.3 Litigation...............................................7
ARTICLE V ADDITIONAL AGREEMENTS....................................7
Section 5.1 Confidentiality..........................................7
Section 5.2 Public Disclosure........................................8
Section 5.3 Further Assurances.......................................8
Section 5.4 General Release..........................................8
Section 5.5 Resignation of Directors................................10
ARTICLE VI MISCELLANEOUS PROVISIONS................................10
Section 6.1 Survival................................................10
Section 6.2 Fees, Expenses and Taxes................................10
Section 6.3 Amendment...............................................10
Section 6.4 Waiver..................................................10
Section 6.5 Entire Agreement........................................10
Section 6.6 Counterparts and Facsimile..............................11
Section 6.7 Governing Law...........................................11
Section 6.8 Consent to Jurisdiction; Venue..........................11
Section 6.9 WAIVER OF JURY TRIAL....................................11
Section 6.10 Attorneys' Fees.........................................11
Section 6.11 Assignments and Successors..............................12
Section 6.12 No Third Party Rights...................................12
Section 6.13 Notices.................................................12
Section 6.14 Construction............................................14
Section 6.15 Enforcement of Agreement................................14
Section 6.16 Severability............................................14
Section 6.17 Publicity...............................................14
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STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT (this "Agreement") is made and entered into
as of May 23, 2013, by and among RUNWAY ACQUISITION SUB, INC., a Delaware
corporation ("Purchaser"), and certain stockholders of Bluefly, Inc., a Delaware
corporation (the "Company"), listed on Schedule A (each, a "Seller" and,
collectively, the "Sellers").
RECITALS
WHEREAS, the Sellers are holders of outstanding shares of common stock, par
value $0.01 per share, of the Company (the "Company Common Stock"), and each
Seller is the record or beneficial holder and has sole voting power over such
number of shares of Company Common Stock as is set forth opposite such Seller's
name on Schedule A (the "Shares");
WHEREAS, upon the terms and subject to the conditions set forth in this
Agreement, Purchaser desires to purchase from Sellers, and Sellers desire to
sell to Purchaser, all of the Shares owned by Sellers (the "Transaction");
NOW, THEREFORE, in consideration of the mutual benefits to be derived from
this Agreement and of the representations, warranties, conditions, agreements
and promises contained in this Agreement, the parties agree as follows:
ARTICLE I
DEFINITIONS
-----------
Certain capitalized terms used in this Agreement have the meanings set
forth below, and other capitalized terms used in this Agreement are defined in
the Sections of this Agreement where they first appear. All capitalized terms
shall be equally applicable to both the singular and plural forms. Any agreement
referred to below shall mean such agreement as amended, supplemented and
modified from time to time to the extent permitted by the applicable provisions
thereof and by this Agreement.
"Affiliate" shall mean, with respect to a Person, any other Person that,
directly or indirectly, Controls, is Controlled by or is under common Control
with such Person. The term "Affiliated" has the meaning correlative to the
foregoing.
"Agreement" shall have the meaning set forth in the preamble of this
Agreement.
"Bankruptcy and Equity Exception" shall have the meaning set forth in
Section 3.2(a).
"Blue Sky Laws" shall have the meaning set forth in Section 3.2(c).
"Closing" shall have the meaning set forth in Section 2.3(a).
"Closing Date" shall have the meaning set forth in Section 2.3(a).
"Company" shall have the meaning set forth in the preamble of this
Agreement.
"Company Common Stock" shall have the meaning set forth in the recitals to
this Agreement.
"Consent" shall mean any approval, consent, license, order, ratification,
permission, waiver or authorization from or by any Person, including any
governmental authorization in the form of a permit, license, certificate,
franchise, permission, variance, clearance, registration, qualification or
authorization issued, granted, given or otherwise made available by or under the
authority of any Governmental Body or pursuant to any Law.
"Contract" shall mean any written or oral contract, instrument, agreement,
commitment, license agreement, lease, obligation, undertaking, sales order
(including delivery orders, purchase orders and change orders), joint venture,
indenture, or evidence of indebtedness.
"Control," "Controlled," "Controlling" or "under common Control with" with
respect to any Person, means having the ability to direct the management and
affairs of such Person, whether through the ownership of voting securities, by
Contract or otherwise, and such ability shall be deemed to exist when a Person
holds a majority of the outstanding voting securities of such Person.
"Disclosure Schedules" shall mean the disclosure schedules delivered by
Sellers to Purchaser simultaneously with the execution of this Agreement.
"Entity" shall mean any corporation (including any non-profit corporation),
general partnership, limited partnership, limited liability partnership, joint
venture, estate, trust, company (including any company limited by shares,
limited liability company, or joint stock company), firm, society or other
enterprise, association, organization or entity.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as amended,
and the rules and regulations promulgated thereunder.
"Fundamental Representations" shall have the meaning set forth in Section
6.1.
"Governmental Body" shall mean any: (a) nation, state, commonwealth,
province, territory, county, municipality, district or other jurisdiction of any
nature; (b) federal, state, local, municipal, foreign or other government; or
(c) governmental or quasi-governmental authority of any nature (including any
governmental division, department, agency, commission, instrumentality,
official, organization, unit, body or Entity and any court or other tribunal).
"Law" shall mean any federal, state, local, municipal, foreign or other
law, statute, constitution, principle of common law, resolution, ordinance,
code, edict, decree, rule, regulation, ruling or requirement issued, enacted,
adopted, promulgated, implemented or otherwise put into effect by or under the
authority of any Governmental Body. Reference to any Law means such Law as
amended, modified, codified, replaced or reenacted, in whole or in part, and in
effect from time to time, and reference to any section or other provision of any
Law means that provision of such Law from time to time in effect and
constituting the substantive amendment, modification, codification, replacement
or reenactment of such section or other provision.
"Lien" shall mean any lien, pledge, hypothecation, charge, mortgage,
security interest, encumbrance, claim, infringement, interference, option, right
of first refusal, equitable interest, title retention or title reversion
agreement, preemptive right, community property interest or restriction of any
nature, whether accrued, absolute, contingent or otherwise (including any
restriction on the voting of any security, any restriction on the transfer of
any security or other asset, any restriction on the receipt of any income
derived from any asset, any restriction on the use of any asset and any
restriction on the possession, exercise or transfer of any other attribute of
ownership of any asset).
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"Losses" shall mean damages, liabilities, losses, claims, diminution in
value, obligations, liens, assessments, judgments, Taxes, fines, penalties,
reasonable costs and expenses (including, without limitation, reasonable fees of
counsel) and including all amounts paid in investigation, defense or settlement
of the foregoing.
"Organizational Documents" shall mean an Entity's certificate or articles
of incorporation and bylaws (in the case of a corporation) and similar
organizational documents (in the case of other types of Entities).
"Person" shall mean any individual, Entity or Governmental Body.
"Proceeding" shall mean any action, claim, dispute, arbitration, audit,
hearing, inquiry, investigation, legal proceeding, administrative enforcement
proceeding, litigation, case, or suit (whether civil, criminal, administrative
or investigative) commenced, brought, conducted, or heard by or before, or
otherwise involving, any Governmental Body or arbitration tribunal.
"Purchaser" shall have the meaning set forth in the preamble of this
Agreement.
"Released Claims" shall have the meaning set forth in Section 5.4(a).
"Released Parties" shall have the meaning set forth in Section 5.4(a).
"Releasing Party" or "Releasing Parties" shall have the meaning set forth
in Section 5.4(a).
"SEC" shall mean the United States Securities and Exchange Commission.
"Securities Act" shall mean the Securities Act of 1933, as amended, and the
rules and regulations promulgated thereunder.
"Seller" or "Sellers" shall have the meaning set forth in the preamble of
this Agreement.
"Shares" shall have the meaning set forth in the recitals to this
Agreement.
"Tax" shall mean any tax (including any income tax, franchise tax, capital
gains tax, gross receipts tax, value-added tax, surtax, excise tax, ad valorem
tax, transfer tax, stamp tax, sales tax, use tax, property tax, business tax,
withholding tax or payroll tax), levy, assessment, tariff, duty (including any
customs duty), deficiency or fee, and any related charge or amount (including
any fine, penalty or interest), imposed, assessed or collected by or under the
authority of any Governmental Body.
"Transaction" shall have the meaning set forth in the recitals to this
Agreement.
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ARTICLE II
TRANSACTIONS AT THE CLOSING
---------------------------
Section 2.1 Purchase and Sale of Shares.
(a) Upon the terms and subject to the conditions set forth in this
Agreement and in reliance upon the covenants, representations and warranties
contained herein, at the Closing, (i) each Seller shall sell, convey, transfer,
assign and deliver to Purchaser the number of Shares set forth opposite such
Seller's name on Schedule A, free and clear of all Liens (other than Liens
imposed by applicable securities Laws), and (ii) Purchaser shall purchase and
acquire such Shares from each such Seller, free and clear of all Liens (other
than Liens imposed by applicable securities Laws).
(b) As consideration for the sale, conveyance, transfer, assignment
and delivery by each Seller of the number of Shares set forth opposite such
Seller's name on Schedule A, Purchaser shall, at the Closing, pay to each Seller
an amount in cash equal to the amount set forth opposite such Seller's name on
Schedule A.
Section 2.2 Closing; Closing Deliveries.
(a) The closing of the Transaction (the "Closing") shall take place at
the offices of Xxxxxxxxx Xxxxx Xxxxxxx & Xxxxx, P.C., 000 Xxxxxxxx Xxxxxxxxx,
Xxxxx 000, Xxxxx Xxxxxx, Xxxxxxxxxx 00000, at 10:00 a.m. local time on the date
hereof, or at such other place, date and time as Sellers and Purchaser may
agree. All deliveries to be made or other actions to be taken at the Closing
shall be deemed to occur simultaneously, and no such delivery or action shall be
deemed complete until all such deliveries and actions have been completed. The
date and time at which the Closing actually occurs is referred to herein as the
"Closing Date".
(b) At the Closing, each Seller will deliver, or cause to be
delivered, to Purchaser the following:
(i) the aggregate number of Shares owned by such Seller on the
Closing Date and set forth opposite such Seller's name on Schedule A, evidenced
by a stock certificate or stock certificates, duly endorsed for transfer by
delivery or accompanied by stock powers duly executed in blank (in each case, if
requested by Purchaser, with signatures thereon duly guaranteed or notarized)
and any other documents that are necessary to transfer to Purchaser good and
marketable title to all such Shares free and clear of all Liens; and
(ii) all other instruments, agreements, certificates and
documents required to be delivered by such Seller at or prior to the Closing
Date pursuant to this Agreement.
(c) At the Closing, Purchaser will deliver, or cause to be delivered,
the following to each Seller:
(i) the amount set forth opposite each Seller's name on Schedule
A by wire transfer of immediately available funds to an account designated in
writing by each such Seller; and
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(ii) all other instruments, agreements, certificates and
documents required to be delivered by Purchaser at or prior to the Closing Date
pursuant to this Agreement.
ARTICLE III
REPRESENTATIONS AND WARRANTIES CONCERNING SELLERS
-------------------------------------------------
Except as disclosed in the Disclosure Schedules, which exceptions and
disclosures shall be deemed to be part of the representations and warranties
made hereunder, each Seller, severally but not jointly, and as to itself only,
hereby represents and warrants to Purchaser that the following are true and
correct as of the date of this Agreement (except to the extent expressly related
to a specific date, in which event such representation or warranty shall be made
as of such date):
Section 3.1 Organization and Qualification. Such Seller is duly organized,
validly existing and is in good standing under the laws of its jurisdiction of
incorporation or organization.
Section 3.2 Authority; No Conflict.
(a) Such Seller has all requisite corporate, partnership or similar
power, capacity and authority to execute and deliver this Agreement, to perform
its obligations hereunder and to consummate the transactions contemplated
hereby. The execution and delivery of this Agreement by such Seller, and the
consummation by such Seller of the transactions contemplated hereby, have been
duly and validly authorized by all necessary corporate, partnership or similar
action, and no other action or proceeding on the part of such Seller is
necessary to authorize the execution and delivery of this Agreement or to
consummate the transactions contemplated hereby. This Agreement has been duly
and validly executed and delivered by such Seller and, assuming the due
authorization, execution and delivery of this Agreement by the other parties
hereto, constitutes a legal, valid and binding obligation of such Seller,
enforceable against it in accordance with its terms, except that such
enforcement may be subject to (i) applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws, now or hereafter in effect,
relating to rights of creditors generally and (ii) rules of law and equity
governing specific performance, injunctive relief and other equitable remedies
(collectively, the "Bankruptcy and Equity Exception").
(b) The execution and delivery of this Agreement does not, and the
consummation of the transactions contemplated by this Agreement will not,
directly or indirectly (with or without notice or lapse of time or both), (i)
contravene, conflict with, or result in a violation of any provision of the
Organizational Documents of such Seller; (ii) contravene, conflict with, or
result in a violation of any Law to which such Seller, or any of the Shares, are
subject; or (iii) contravene, conflict with, or result in a violation or breach
of any provision of, or the forfeiture, impairment or acceleration of rights or
obligations under, or give any Person the right to declare a default or exercise
any remedy under, or to accelerate the maturity or performance of, or to cancel,
terminate, or modify, any contract by which such Seller's Shares are bound,
other than for the notes of Rho Ventures VI, LP ("Rho") and Prentice Consumer
Partners, LP ("Prentice") that will become due and payable on a change of
control; except in the cases of clauses (ii) and (iii), for such matters as
would not materially adversely impact the ability of such Seller to consummate
the transactions contemplated by this Agreement.
(c) The execution and delivery of this Agreement by such Seller does
not, and the consummation of the transactions contemplated by this Agreement
will not, require any Consent of, registration or filing with, or declaration or
notification to, any Person, except for (i) applicable requirements, if any, of
the Exchange Act, the Securities Act and state securities or "blue sky" laws
("Blue Sky Laws"), and (ii) such other Consents, registrations, filings,
declarations or notifications the failure of which to be obtained or made would
not prevent such Seller from performing its obligations under this Agreement in
any material respect.
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Section 3.3 Ownership. Such Seller owns, beneficially or of record, the
number of Shares set forth opposite such Seller's name on Schedule A, free and
clear of any and all Liens (other than Liens imposed by applicable securities
Laws).
Section 3.4 Access to Information. Such Seller has had an opportunity to
review this Agreement with assistance of counsel and other advisors of such
Seller's own choosing.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES CONCERNING PURCHASER
---------------------------------------------------
Purchaser hereby represents and warrants to Sellers that the following are
true and correct as of the date of this Agreement (except to the extent
expressly related to a specific date, in which event such representation or
warranty shall be made as of such date):
Section 4.1 Organization and Qualification. Purchaser is a corporation duly
organized, validly existing, and in good standing under the laws of its
jurisdiction of incorporation. Purchaser has the requisite corporate power and
authority and possesses all material governmental franchises, licenses, permits,
authorizations and approvals necessary to own, lease, and operate its properties
and to conduct its business as now being conducted. Purchaser is duly qualified
or licensed to do business and is in good standing (where such concept is
applicable) in each jurisdiction in which the character of the properties or
assets owned or operated by it, or the nature of its business, makes such
licensing or qualification necessary, except where the failure to be so
qualified, licensed or in good standing could not reasonably be expected to,
individually or in the aggregate, result in a material adverse effect on
Purchaser or its ability to consummate the transactions contemplated by this
Agreement.
Section 4.2 Authority; No Conflict.
(a) Purchaser has all requisite corporate power, capacity and
authority to execute and deliver this Agreement, to perform its obligations
hereunder and to consummate the transactions contemplated hereby. The execution
and delivery of this Agreement by Purchaser, and the consummation by Purchaser
of the transactions contemplated hereby, have been duly and validly authorized
by all necessary corporate action, and no other action or proceedings on the
part of Purchaser is necessary to authorize the execution and delivery of this
Agreement or to consummate the transactions contemplated hereby. This Agreement
has been duly and validly executed and delivered by Purchaser and, assuming the
due authorization, execution and delivery of this Agreement by Sellers,
constitutes a legal, valid and binding obligation of Purchaser, enforceable
against it in accordance with its terms, except that such enforcement may be
subject to the Bankruptcy and Equity Exception.
(b) The execution and delivery of this Agreement does not, and the
consummation of the transactions contemplated by this Agreement will not,
directly or indirectly (with or without notice or lapse of time or both); (i)
contravene, conflict with, or result in a violation of any provision of the
Organizational Documents of Purchaser; (ii) contravene, conflict with, or result
in a violation of any Law to which Purchaser is subject; or (iii) contravene,
conflict with, or result in a violation or breach of any provision of, or the
forfeiture, impairment or acceleration of any rights or obligations under, or
give any Person the right to declare a default or exercise any remedy under, or
to accelerate the maturity or performance of, or to cancel, terminate, or
modify, any Contract to which Purchaser is a party.
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(c) The execution and delivery of this Agreement by Purchaser does
not, and the consummation of the transactions contemplated by this Agreement
will not, require any Consent of, registration or filing with, or declaration or
notification to, any Person, except (i) for applicable requirements, if any, of
the Exchange Act, the Securities Act and Blue Sky Laws, and (ii) such other
Consents, registrations, filings, declarations or notifications the failure of
which to be obtained or made would not prevent Purchaser from performing its
obligations under this Agreement in any material respect.
Section 4.3 Litigation. There is no litigation, arbitration or other
Proceeding pending or, to the knowledge of Purchaser, threatened against
Purchaser, and there is no judgment, decree or order against Purchaser, that
would be reasonably likely to adversely affect Purchaser's ability to consummate
the Transaction.
ARTICLE V
ADDITIONAL AGREEMENTS
---------------------
Section 5.1 Confidentiality. Except as otherwise provided in this
Agreement, such Seller will keep confidential, and not use or disclose, except
in connection with this Agreement and the transactions contemplated by this
Agreement, all information, documents or materials relating solely to the
Company and its business which, prior to the date hereof, have been furnished to
it by or on behalf of the Company, any of its Subsidiaries, any other Seller,
any other stockholder of the Company, or Purchaser. The provisions of this
Section 5.1 shall not apply to the disclosure or use of any information,
documents or materials (a) which are or become generally available to the public
other than as a result of disclosure by any Seller after receiving such
information or any Affiliate or Representative of such Seller receiving such
information in violation of this Section 5.1, (b) required by applicable Law to
be disclosed by such Seller (but only, to the extent practical and permitted by
applicable Law, after providing Purchaser with written notice of its intention
to disclose such information and after Purchaser has had notice of the proposed
disclosure in order to provide it with an opportunity to challenge such
disclosure in a court of law), or (c) necessary to establish such Seller's
rights under this Agreement. Further, the "residual knowledge" resulting from
access to or work with such confidential information shall not be subject to the
confidentiality and non-use obligations contained in this Agreement. For the
purposes hereof, the term "residual knowledge" means know-how and experience
gained by a Seller and its representatives (other than third-party
representatives) during its ownership of securities of the Company or from
exposure to the confidential information, and retained in the unaided memories
of such Seller's representatives (other than third-party representatives)
without reference to any information or material that is written, stored in
magnetic, electronic or physical form or otherwise fixed. For purposes hereof,
the memory of a person is unaided if the person has not intentionally memorized
the confidential information for the purpose of retaining and subsequently using
or disclosing such confidential information. The provisions of this Section 5.1
shall terminate on the second (2nd) anniversary of the date hereof.
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Section 5.2 Public Disclosure.
(a) Following the Closing, Purchaser may issue a press release
announcing the Transaction, the content of such press release to be mutually
agreed upon by the Purchaser and the Sellers, and the timing of such press
release to be determined by Purchaser in its sole and absolute discretion.
(b) Purchaser will not, and Purchaser will not permit any of its
Affiliates to, use or refer to any Seller, its name or any derivation thereof,
its investment advisor or the funds advised by such investment advisor or the
names or any derivations thereof, as being a party to this Agreement or as being
involved in the transactions contemplated by this Agreement (other than to the
extent expressly contained in the Company's filings with the SEC on or before
the date hereof) including, without limitation, in any filing with any
Governmental Body, any press release, any public announcement or statement,
advertisement or in any interview or other discussion with any reporter or other
member of the media, without the prior written consent of such Seller with
respect to each such use or reference; provided, however, that any such
information may be disclosed by Purchaser or any of its Affiliates to the extent
that such person has received advice from its counsel that it is required by
applicable Law to do so, provided that prior to making such disclosure, such
person shall, to the extent practicable and permitted by applicable Law, notify
such Seller in writing and shall use reasonable efforts to preserve the
confidentiality of such information, including consulting with such Seller
regarding such disclosure and, if reasonably requested by such Seller and at
such Seller's sole cost and expense, assisting such Seller in seeking a
protective order to prevent the requested disclosure; and provided, further,
that any such information may be disclosed by Purchaser or any of its Affiliates
without such prior written consent in internal announcements to their respective
investors, potential investors or investor groups.
Section 5.3 Further Assurances. Each Seller, as to itself, on the one hand,
and Purchaser, on the other hand, agree that subsequent to the Closing Date, at
the request of the other party or parties, they will execute and deliver, or
cause to be executed and delivered, to the other party or parties such further
instruments and take such other action as may be necessary or desirable to carry
out the transactions contemplated by this Agreement or to vest, perfect or
confirm ownership of the Shares in Purchaser.
Section 5.4 General Release. Effective upon the Closing Date:
(a) Each Seller, on its behalf and, to the fullest extent permitted by
applicable Law, on behalf of its respective Affiliates, heirs, legal
representatives, successors and assigns (each, a "Releasing Party" and,
collectively, the "Releasing Parties"), hereby acknowledges complete
satisfaction of and hereby absolutely, unconditionally, irrevocably and fully
releases and forever discharges each of the Company, its present and former
Affiliates (including Purchaser), predecessors, successors and assigns, and
their respective directors, officers, stockholders, members, partners, agents
and employees (collectively, the "Released Parties") of and from any and all
commitments, Proceedings, debts, counterclaims, causes of action, demands,
Losses, and compensation of every kind or nature whatsoever, past, present, or
future, at law, in equity or otherwise, whether known or unknown, whether
contingent or absolute, whether concealed or hidden, whether disclosed or
undisclosed, whether liquidated or unliquidated, whether foreseeable or
unforeseeable, whether anticipated or unanticipated, whether suspected or
unsuspected, and whether arising by operating of law or otherwise, including,
without limitation, with respect to conduct which is negligent, grossly
negligent, willful, intentional, with or without malice, or a breach of any
duty,
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Law or rule, which such Releasing Parties, or any of them, ever have had, or
ever in the future may have against the Released Parties, or any of them, and
which are based on acts, events or omissions occurring up to and including the
Closing Date, including, without limitation, any acts, events or omissions
arising out of or based on such Releasing Party's relationship with the Company
or any of its present or former Affiliates or predecessors, such Releasing
Party's rights or status as a stockholder of the Company or any of its present
or former Affiliates or predecessors (collectively, the "Released Claims");
provided, however, that nothing in this Section 5.4 shall release, acquit, or
discharge, and the term "Released Claims" shall not include, in any respect (i)
any rights that a Releasing Party may have under this Agreement or the other
documents and agreements executed and delivered pursuant to this Agreement
including the Stock Purchase Agreement, dated as of the date hereof, between the
Company and Purchaser or any other documents or agreements executed and
delivered pursuant to such Stock Purchase Agreement, (ii) any rights that a
Releasing Party may have or bring arising under the Organizational Documents of
the Company, or any other rights of indemnification or constitution of law or in
equity, (iii) any rights that a Releasing Party, including for the avoidance of
doubt, any current or former member of the board of the Company appointed by
such Releasing Party, may have under the Company's statutory indemnification
procedures, any director indemnity agreements as in effect at the date hereof
and any D&O insurance and indemnification policies as in effect at the date
hereof, (iv) any rights Prentice or its Affiliates may have under its Secured
Subordinated Promissory Note, dated August 13, 2012 and amended as of November
13, 2012 between the Company and Prentice, which shall be released by a separate
release upon payment thereof, or (v) any rights Rho or its Affiliates may have
under its Secured Subordinated Convertible Promissory Note, dated August 13,
2012 and amended as of November 13, 2012 between the Company and Rho, which
shall be released by a separate release upon payment thereof. Each Seller, on
its behalf and, to the fullest extent permitted by applicable Law, on behalf of
the Releasing Parties, hereby waives any rights it may have under any Law which
provides that a general release does not extend to claims which the releasing
party does not know or suspect to exist in its favor at the time of executing
the release, which if known by it may have materially affected its settlement.
Each Seller, on its behalf and, to the fullest extent permitted by applicable
Law, on behalf of its Releasing Parties, acknowledges that it may hereafter
discover facts in addition to or different from those which it now knows or
believes to be true with respect to the subject matter of the claims released
hereby, but each Seller, on its behalf and on behalf of the Releasing Parties,
intends to and, by operation of this Agreement shall have, fully, finally and
forever settled and released any and all Released Claims without regard to the
subsequent discovery of existence of such different or additional facts.
(b) Each Seller represents, warrants, covenants and agrees that it (i)
has not (and to its knowledge, its Releasing Parties have not) and will not (and
will use its reasonable best efforts to cause its Releasing Parties not to)
assign any Released Claim or possible Released Claim against any Released Party,
(ii) fully intends to release all Released Claims against the Released Parties,
including, without limitation, unknown and contingent Released Claims (other
than those specifically reserved above), and (iii) has consulted with counsel
with respect to the matters covered hereby and has been fully apprised of the
consequences hereof.
(c) Each Seller covenants and agrees not to, and agrees to use its
reasonable efforts to cause its respective Affiliates not to, whether in its own
capacity, as successor, by reason of assignment or otherwise, assert, institute
or join in, or assist or encourage any third party in asserting, any litigation
or Proceeding against any of the Released Parties with respect to any Released
Claims.
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Section 5.5 Resignation of Directors. Each Seller shall cause any director
of the Company designated by such Seller and serving in such capacity as of the
Closing Date to tender his written resignation, such resignation to be effective
upon consummation of the Closing.
ARTICLE VI
MISCELLANEOUS PROVISIONS
------------------------
Section 6.1 Survival. None of the representations, warranties, covenants
and agreements in this Agreement or in any agreement, document or instrument
executed and delivered pursuant to this Agreement shall survive the Closing,
except for (a) those representations and warranties of Sellers set forth in
Sections 3.2(a), 3.3 and 4.2(a) (the "Fundamental Representations") which shall
survive until the date that is eighteen (18) months from the date hereof and (b)
those covenants and agreements contained herein and therein which by their terms
apply, in whole or in part, after the Closing, and then only to such extent.
Neither party to this Agreement shall have any liability to any other party for
Losses arising out of, based upon or by reason of any breach of any of the
representations, warranties, covenants or agreements of such party in this
Agreement or any agreement, document or instrument executed and delivered
pursuant to this Agreement; provided, however, that nothing in this Agreement
shall limit a party's liability in respect of Losses resulting from or arising
out of any breach of the Fundamental Representations or any fraud or willful
misconduct.
Section 6.2 Fees, Expenses and Taxes. All fees, expenses and Taxes incurred
in connection with this Agreement and the Transaction shall be paid by the party
incurring such fees, expenses, or Taxes.
Section 6.3 Amendment. This Agreement may not be amended, except by an
instrument in writing signed by or on behalf of Purchaser and each of the
Sellers.
Section 6.4 Waiver. Neither any failure nor any delay by any party in
exercising any right, power or privilege under this Agreement or any of the
documents referred to in this Agreement will operate as a waiver of such right,
power or privilege, and no single or partial exercise of any such right, power
or privilege will preclude any other or further exercise of such right, power or
privilege or the exercise of any other right, power or privilege. To the maximum
extent permitted by Law, (i) no waiver that may be given by a party will be
applicable except in the specific instance for which it is given; and (ii) no
notice to or demand on one party will be deemed to be a waiver of any obligation
of that party or of the right of the party giving such notice or demand to take
further action without notice or demand as provided in this Agreement or the
documents referred to in this Agreement.
Section 6.5 Entire Agreement. This Agreement (including the Disclosure
Schedule and the exhibits, annexes and appendices hereto) and the documents and
instruments and other agreements among the parties hereto as contemplated by or
referred to herein constitute the entire agreement among the parties to this
Agreement and supersede all prior agreements and understandings, both written
and oral, among or between any of the parties with respect to the subject matter
hereof.
10
Section 6.6 Counterparts and Facsimile.
(a) This Agreement may be executed in several counterparts, and by the
different parties hereto in separate counterparts, each of which when executed
shall be deemed to be an original and all of which shall together constitute one
and the same instrument, and shall become effective when counterparts have been
signed by each of the parties and delivered to the other parties.
(b) The exchange of copies of this Agreement and of signature pages by
facsimile transmission (whether directly from one facsimile device to another by
means of a dial-up connection or whether mediated by the worldwide web), by
electronic mail in "portable document format" (".pdf"), or by any other
electronic means intended to preserve the original graphic and pictorial
appearance of a document, or by a combination of such means, shall be as
effective as delivery of a manually signed counterpart of this Agreement and
shall constitute effective execution and delivery of this Agreement as to the
parties and may be used in lieu of a manually signed counterpart of this
Agreement for all purposes.
Section 6.7 Governing Law. Except to the extent that the corporate laws of
the State of Delaware apply to a party, this Agreement shall be governed by, and
construed in accordance with, the laws of the State of Delaware, regardless of
the laws that might otherwise govern under applicable principles of conflicts of
law thereof.
Section 6.8 Consent to Jurisdiction; Venue. In any action, proceeding or
counterclaim (whether based on contract, tort, or otherwise) between the parties
arising out of or relating to this Agreement or the transactions contemplated
hereby, each of the parties hereby: (a) irrevocably and unconditionally consents
and submits to the exclusive jurisdiction and venue of the Court of Chancery of
the State of Delaware, or if such court lacks subject matter jurisdiction over
the action or proceeding, the Superior Court of the State of Delaware, or if
jurisdiction is vested exclusively in the federal courts, the United States
District Court for the District of Delaware; (b) agrees that it will not attempt
to deny or defeat such jurisdiction or venue by motion or other request for
leave from any court and waives the defense of an inconvenient forum to the
maintenance of any such action or proceeding; and (c) agrees that all claims in
respect of such action, proceeding or counterclaim may be heard and determined
exclusively in Court of Chancery of the State of Delaware .The consents to
jurisdiction set forth in this paragraph shall not constitute general consents
to service of process in the State of Delaware and shall have no effect for any
purpose, except as provided in this paragraph and shall not be deemed to confer
rights on any person other than the parties hereto. Each of the parties hereto
agrees that a final judgment in any such action, proceeding or counterclaim
shall be conclusive and may be enforced in other jurisdictions by suit on the
judgment or in any other manner provided by law.
Section 6.9 WAIVER OF JURY TRIAL. EACH OF THE PARTIES HEREBY IRREVOCABLY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY AND ALL RIGHTS TO TRIAL BY
JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT,
OR OTHERWISE) BETWEEN THE PARTIES ARISING OUT OF OR RELATING TO THIS AGREEMENT
OR ANY OF THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT.
Section 6.10 Attorneys' Fees. In any action at law or suit in equity to
enforce this Agreement or the rights of any of the parties hereunder, and except
as provided in Section 6.2, the prevailing party in such action or suit (as
determined in a final, non-appealable decision by a court of competent
jurisdiction) shall be entitled to receive a reasonable sum for its fees
(including reasonable attorneys' fees), costs and expenses incurred in such
action or suit.
11
Section 6.11 Assignments and Successors. Neither this Agreement nor any of
rights, interests or obligations hereunder may be assigned, in whole or in part,
by any party hereto without the prior written consent of Purchaser, in the case
of any assignment by a Seller, or Sellers, in the case of any assignment by
Purchaser. Any attempted assignment of this Agreement or of any such rights by
any party without such consent shall be void and of no effect. Subject to the
preceding two sentences, this Agreement shall be binding upon, and shall be
enforceable by and inure to the benefit of, the parties hereto and their
respective successors and assigns.
Section 6.12 No Third Party Rights. Nothing in this Agreement, express or
implied, is intended to or shall confer upon any Person (other than the parties
hereto) any right, benefit or remedy of any nature whatsoever under or by reason
of this Agreement; provided, however, that the Released Parties (with respect to
their rights under Section 5.4) shall be intended third party beneficiaries.
Section 6.13 Notices. All notices, requests, Consents, claims, demands,
waivers and other communications required or permitted by this Agreement shall
be in writing and shall be deemed given to a party when (a) delivered to the
appropriate address by hand; (b) when received by the addressee at the
appropriate address if sent by a nationally recognized overnight courier service
(costs prepaid and receipt requested); (c) on the date sent by facsimile or
e-mail (with confirmation of transmission) if sent during normal business hours
of the recipient, and on the next business day of sent after normal business
hours of the recipient; or (d) on the third (3rd) day after the date mailed, by
certified or registered mail, return receipt requested, postage prepaid, in each
case to the following addresses, facsimile numbers or email addresses and marked
to the attention of the person (by name or title) designated below (or to such
other address, facsimile number, email address or person as a party may
designate by notice to the other parties in accordance with this section):
if to Purchaser, to:
Clearlake Capital Group, L.P.
000 Xxxxxxxx Xxxxxxxxx, Xxxxx 000
Xxxxx Xxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxx Xxxxxxx, Partner
Facsimile: (000) 000-0000
Email: xxxxxx@xxxxxxxxxxxxxxxx.xxx
with a copy (which shall not constitute notice) to:
Xxxxxxxxx Xxxxx Xxxxxxx & Xxxxx, P.C.
000 Xxxxxxxx Xxxxxxxxx, Xxxxx 000
Xxxxx Xxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxx, Esq.
Facsimile: (000) 000-0000
Email: xxxxxx@xxxx.xxx
12
if to Rho:
Rho Ventures VI, X.X.
Xxxxxxxx Xxxx Tower
000 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxxxx, Esq.
Facsimile: (000) 000-0000
if to Quantum:
Quantum Industrial Partners LDC
c/x Xxxxx Fund Management LLC
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxx Xxxxxxxxxxxx
Facsimile: (000) 000-0000
with a copy (which shall not constitute notice) to:
Xxxxxxxx & Xxxxx LLP
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx Xxxxxx, Esq.
Facsimile: (000) 000-0000
if to Prentice:
Prentice Consumer Partners, LP
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx Xxxxxxxxx
Facsimile: (000) 000-0000
with a copy (which shall not constitute notice) to:
Xxxxxxxxxx Xxxxxxx PC
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxxxxx, Esq.
Facsimile: (000) 000-0000
if to the Maverick Parties:
Maverick Fund USA, Ltd.
Maverick Fund, L.D.C.
Maverick Fund II, Ltd.
c/o Maverick Capital, Ltd.
000 Xxxxxxxx Xxxxx, 00xx Xxxxx
Xxxxxx, Xxxxx 00000
Attention: General Counsel
Facsimile: (000) 000-0000
13
with a copy (which shall not constitute notice) to:
Shearman & Sterling, LLP
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxxx, Esq.
Facsimile: (000) 000-0000
Section 6.14 Construction. The parties hereto have jointly participated in
the negotiation and drafting of this Agreement. In the event of an ambiguity or
in the event a question of intent or interpretation arises, this Agreement shall
be construed as if drafted jointly by the parties hereto, and no presumptions or
burdens of proof shall arise favoring any party hereto by virtue of the
authorship of any of the provisions of this Agreement.
Section 6.15 Enforcement of Agreement. Except as otherwise expressly
provided herein, any and all remedies herein expressly conferred upon a party
hereunder shall be deemed cumulative with and not exclusive of any other remedy
conferred hereby or by law on such party, and the exercise of any one remedy
shall not preclude the exercise of any other. The parties acknowledge and agree
that each other party hereunder would be irreparably damaged if any of the
provisions of this Agreement are not performed in accordance with their specific
terms and that any breach of this Agreement by a party hereunder could not be
adequately compensated in all cases by monetary damages alone. Accordingly, in
addition to any other right or remedy to which a party hereunder may be
entitled, at law or in equity, it shall be entitled to enforce any provision of
this Agreement by a decree of specific performance and temporary, preliminary
and permanent injunctive relief to prevent breaches or threatened breaches of
any of the provisions of this Agreement, without posting any bond or other
undertaking.
Section 6.16 Severability. If any provision of this Agreement is held
invalid or unenforceable by any court of competent jurisdiction, the other
provisions of this Agreement will remain in full force and effect. Any provision
of this Agreement held invalid or unenforceable only in part or degree will
remain in full force and effect to the extent not held invalid or unenforceable.
Section 6.17 Publicity. Except for such disclosure as may be required by
SEC rules and regulations, and subject to Section 5.2, no party hereto shall
issue any press release or otherwise make any public statement with respect to
the transactions contemplated by this Agreement without the prior consent of the
other parties as to the form and substance of such press release or statement
(which consent shall not be unreasonably withheld or delayed).
[Remainder of Page Intentionally Left Blank - Signature Pages Follow]
14
IN WITNESS WHEREOF, each of the parties hereto has executed this
Agreement, or has caused this Agreement to be duly executed on its behalf, as of
the day and year first above written.
PURCHASER:
----------
RUNWAY ACQUISITION SUB, INC.
By: /s/ Xxxxxx Xxxxxxx
-------------------------------------
Name: Xxxxxx Xxxxxxx
Title: Vice President
[Signature Page to Stock Purchase Agreement]
SELLERS:
--------
RHO VENTURES VI, L.P.
By: RMV VI, L.L.C., its General Partner
By: Rho Capital Partners LLC, its
Managing Member
By: /s/ Xxxxxxx Xxxxxx
-------------------------------------
Name: Xxxxxxx Xxxxxx
Title: Attorney-in-fact
[Signature Page to Stock Purchase Agreement]
PRENTICE CONSUMER PARTNERS, LP
By: Prentice Consumer Partners GP, LLC
By: /s/ Xxxxx Xxxxxx
-------------------------------------
Name: Xxxxx Xxxxxx
Title: Managing Partner
[Signature Page to Stock Purchase Agreement]
MAVERICK FUND, LDC.
By: Maverick Capital, Ltd.
its investment manager
By: /s/ Xxxxxxxx Xxxxxx
-------------------------------------
Name: Xxxxxxxx Xxxxxx
Title: Director of Fund Accounting
MAVERICK FUND II, LTD
By: Maverick Capital, Ltd.
its investment manager
By: /s/ Xxxxxxxx Xxxxxx
-------------------------------------
Name: Xxxxxxxx Xxxxxx
Title: Director of Fund Accounting
MAVERICK USA LTD
By: Maverick Capital, Ltd.
its investment manager
By: /s/ Xxxxxxxx Xxxxxx
-------------------------------------
Name: Xxxxxxxx Xxxxxx
Title: Director of Fund Accounting
[Signature Page to Stock Purchase Agreement]
QUANTUM INDUSTRIAL PARTNERS LDC
By: /s/ Xxxxxx X. X'Xxxxx
-------------------------------------
Name: XXXXXX X. X'XXXXX
Title: Attorney-in-fact
[Signature Page to Stock Purchase Agreement]
SCHEDULE A
BLUEFLY, INC. SHARE OWNERSHIP
-------------------------------------------------------------------
SHAREHOLDER SHARES PRICE
-------------------------------------------------------------------
Quantum Industrial Partners 6,480,070 $49,417.04
LDC
-------------------------------------------------------------------
Prentice Consumer Partners, 3,371,958 $25,714.57
LP
-------------------------------------------------------------------
Maverick Fund, L.D.C. 1,601,113 $12,210.09
-------------------------------------------------------------------
Maverick Fund II, LTD. 1,397,170 $10,654.82
-------------------------------------------------------------------
Maverick USA LTD. 705,816 $5,382.56
-------------------------------------------------------------------
Maverick Total: 3,704,099 $28,247.47
-------------------------------------------------------------------
Rho Ventures VI, L.P. 11,900,164 $90,750.70
-------------------------------------------------------------------
-------------------------------------------------------------------
TOTAL 25,456,291 $194,129.78
-------------------------------------------------------------------
