EXHIBIT 1
RATIFICATION AND VOTING AGREEMENT
---------------------------------
RATIFICATION AND VOTING AGREEMENT (the "Agreement"),
dated as of June 12, 1997, between Trefoil Capital Investors II, L.P.,
a Delaware limited partnership ("Trefoil II") and GE Investment
Private Placement Partners II, A Limited Partnership, a Delaware
limited partnership ("GEI II" and together with Trefoil II, the
"Purchasers"), concerning The Grand Union Company, a Delaware
corporation (the "Company").
PREAMBLE
--------
The Company and the Purchasers are parties to a Stock
Purchase Agreement (the "Purchase Agreement"), dated as of
July 30, 1996, which provided, among other things, for the
acquisition by the Purchasers of shares of the Company's Class A
Convertible Preferred Stock (the "Class A Preferred Stock").
The Company and the Purchasers are parties to an
Acceleration and Exchange Agreement (the "Acceleration and
Exchange Agreement"), dated as of June 5, 1997, which provides,
among other things, for the acquisition by the Purchasers of
shares of the Company's Class B Convertible Preferred Stock (the
"Class B Preferred Stock").
As of the date hereof, each of the Purchasers holds
sole voting power with respect to shares of Class A Preferred
Stock of the Company entitled to the number of votes, or the
number of shares of the common stock of the Company, par value
$1.00 per share (the "Common Stock" and, together with the number
of votes represented by the shares of Class A Preferred Stock set
forth on Schedule I hereto, the "Voting Securities") set forth
opposite such Purchaser's name on Schedule I (the "Subject
Shares").
In order to induce the other Purchaser to consummate
the transactions contemplated by the Acceleration and Exchange
Agreement (the "Transactions") and for other good and valuable
consideration, each Purchaser agrees to take reasonable steps to
facilitate the Transactions and to vote the Subject Shares held
by it as contemplated by this Agreement.
ACCORDINGLY, the parties hereto agree as follows:
1. Voting in Favor of Acceleration and Exchange
Agreement. Each Purchaser agrees to support the Acceleration and
Exchange Agreement and the Transactions in any reasonable manner,
including by taking any reasonable action requested by the other
Purchaser; provided, however, that the foregoing shall not be
deemed to restrict such Purchaser's ability, if any, to transfer
or dispose of such Subject Shares. Each Purchaser will vote all
of the Subject Shares held by it in favor of the Acceleration and
Exchange Agreement and the Transactions, and against any
agreement or course of action that would prohibit, delay,
interfere with or otherwise be inconsistent with the Acceleration
and Exchange Agreement or the Transactions, (a) at any annual or
special meeting (or any adjournment or postponement thereof) of
the stockholders of the Company at which the Acceleration and
Exchange Agreement or the Transactions are submitted to a vote or
(b) at the request of the other Purchaser, by its written
consent.
2. Granting of Irrevocable Proxy. Upon the request
of the other Purchaser, each Purchaser will deliver to one or
more persons an irrevocable proxy (the "Proxy") with respect to
all of the Subject Shares held by it, which such Proxy shall be
deemed to be coupled with an interest, to vote all of the Subject
Shares held by it in favor of the Acceleration and Exchange
Agreement and the Transactions at any annual or special meeting
of the stockholders of the Company at which the Acceleration and
Exchange Agreement or the Transactions are submitted to a vote in
the same manner and with the same effect as if such Purchaser was
personally present at such meeting. Any such Proxy shall expire
upon the Expiration Date as defined in Section 5 hereof.
Notwithstanding anything to the contrary herein, Section 2 of the
Stockholder Agreement, dated as of July 30, 1996, between the
Purchasers, shall govern the voting of the Voting Stock held by
each Purchaser with respect to election of members of the Board
of Directors of the Company.
3. Third Party Offers. Between the date hereof and
the Expiration Date, each Purchaser agrees that it shall not
directly or indirectly solicit, initiate or encourage inquiries
or proposals, or participate in any negotiations leading to any
proposal, concerning any transaction involving the Company that
would cause the Company to fail to consummate the Transactions or
that would otherwise be inconsistent with, violate or breach the
terms of this Agreement or the Acceleration and Exchange
Agreement. Each Purchaser will promptly advise the other
Purchaser of any offers or proposals it may receive relating to
any such transaction.
4. Representations and Warranties of the Purchasers.
Each Purchaser hereby represents and warrants to the other
Purchaser as follows:
4.1. The Purchaser is validly existing and in good
standing under the laws of the jurisdiction of its organization.
4.2. The Purchaser is the sole, true and lawful
record owner of the Subject Shares set forth opposite its name on
Schedule I hereto and has all necessary power and authority to
enter into this Agreement and to perform such Purchaser's
obligations hereunder.
4.3. None of the Subject Shares owned by the
Purchaser is subject to any voting trust or, except pursuant to
this Agreement, or the Stockholder Agreement dated as of July 30,
1996 between the Purchasers, as amended (the "Purchasers
Stockholder Agreement"), other agreement or arrangement with
respect to the voting of such Subject Shares.
4.4. The execution, delivery and performance of
this Agreement by the Purchaser and the consummation by it of the
transactions contemplated hereby have been approved by all
necessary action on the part of the Purchaser.
4.5. This Agreement is the legal, valid and
binding agreement of the Purchaser.
4.6. The execution, delivery and performance of
this Agreement by the Purchaser does not and will not constitute
a violation of, conflict with or result in a default under (a)
any contract, understanding or arrangement to which the Purchaser
is a party or by which such Purchaser is bound, or require the
consent of any other person or any party pursuant thereto, or (b)
any judgment, decree or order applicable to the Purchaser.
4.7. The number of Subject Shares set forth
opposite such Purchaser's name on Schedule I hereto are the only
Voting Securities of the Company owned of record, by the
Purchaser and the Purchaser owns no options to purchase or rights
to subscribe for or otherwise acquire any other Voting Securities
of the Company except pursuant to the Acceleration and Exchange
Agreement and the Purchaser Stockholder Agreement.
5. Termination. This Agreement shall terminate on
the earlier of (a) December 31, 1997, (b) the tenth (10th) day
following the date on which the Company has satisfied all
conditions, if any, requisite to consummation of the Closings (as
defined in the Acceleration and Exchange Agreement) without
violating the Company's obligations under the NASDAQ Rules and
(c) the tenth (10th) day following termination of the
Acceleration and Exchange Agreement in accordance with its terms
(the "Expiration Date").
6. Remedies. The parties hereto acknowledge that
damages would be an inadequate remedy for a breach of the
provisions of this Agreement and that, in addition to any other
remedy available at law, the obligations of the Purchasers shall
be specifically enforceable.
7. Miscellaneous.
7.1. Assignment. This Agreement shall not be
assignable by the parties hereto, except by operation of law and
except that any Proxy granted pursuant to the terms of this
Agreement may be assigned by the Purchasers to any person
affiliated with the Purchasers.
7.2. Amendments. This Agreement may not be
modified, amended, altered or supplemented, except upon the
execution and delivery of a written agreement executed by the
Purchasers.
7.3. Notices. All notices, requests, claims,
demands and other communications hereunder shall be given in
writing and shall be deemed sufficiently given when delivered by
hand or by conformed facsimile transmission, on the second
business day after a writing is consigned (freight prepaid) to a
commercial overnight courier, and on the fifth business day after
a writing is deposited in the mail, postage and other charges
prepaid, addressed as follows:
(a) If to Trefoil II:
Trefoil Capital Investors II, L.P.
c/o Shamrock Capital Advisors, Inc.
0000 Xxxxxxxx Xxxxx
Xxxxxxx, XX 00000
Attn: Xxxxxxx X. Gold, President
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
With a copy to:
Fried, Frank, Harris, Xxxxxxx & Xxxxxxxx
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, XX 00000
Attn: Xxxxx X. Xxxxxxx, Esq.
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
With copies to:
Chief Executive Officer
The Grand Union Company
000 Xxxxxxxxxxx Xxxxxxxxx
Xxxxx, XX 00000-0000
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
and
Xxxxx Xxxx & Xxxxxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxx, Esq.
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
(b) If to GEI II.
GE Investment Private Placement Partners II,
A Limited Partnership
0000 Xxxxxx Xxxxxx
Xxxxxxxx, XX 00000
Attn: Xxxxxxx Xxxxxxx
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
With copies to:
Xxxxx Xxxxxxxxxx
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxxxx, Esq.
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
and
Chief Executive Officer
The Grand Union Company
000 Xxxxxxxxxxx Xxxxxxxxx
Xxxxx, XX 00000-0000
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
and
Xxxxx Xxxx & Xxxxxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxx, Esq.
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
or to such other address as the Purchaser may have furnished to
the other Purchaser, in writing in accordance herewith, except
that notices of change of address shall be effective only upon
receipt.
7.4. Governing Law. This Agreement shall be
governed by and construed in accordance with the internal laws of
the State of New York.
7.5. Severability. If any term, provision,
covenant or restriction of this Agreement is held by a court of
competent jurisdiction to be invalid, void or unenforceable, the
remainder of the terms, provisions, covenants and restrictions of
this Agreement shall continue in full force and effect and shall
in no way be affected, impaired or invalidated.
7.6. Counterparts. This Agreement may be executed
in several counterparts, each of which shall be an original, but
all of which together shall constitute one and the same
Agreement.
IN WITNESS WHEREOF, the Purchasers have caused this
Ratification and Voting Agreement to be duly executed as of the
day and year first above written.
TREFOIL CAPITAL INVESTORS II, L.P.
By: TREFOIL INVESTORS II, INC.,
its managing general partner
By: Xxxxxxx X. XxXxxxxxx
---------------------------
Name: Xxxxxxx X. XxXxxxxxx
Title: Vice President
GE INVESTMENT PRIVATE PLACEMENT
PARTNERS II, A LIMITED PARTNERSHIP
By: GE INVESTMENT MANAGEMENT
INCORPORATED, a general partner
By: Xxxxxxx X. Xxxxxxx
---------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Vice President
Schedule I
Percentage of
Currently
Number of Outstanding Voting
Voting Securities of the
Name and Address of Stockholder Securities Held Company
------------------------------- --------------- -------
Trefoil Capital Investors II, L.P. 7,035,994 28.74%
c/o Shamrock Capital Advisors, Inc.
0000 Xxxxxxxx Xxxxx
Xxxxxxx, XX 00000
GE Investment Private Placement 7,035,994 28.74%
Partners
II, A Limited Partnership
0000 Xxxxxx Xxxxxx
Xxxxxxxx, XX 00000
