VOTING AGREEMENT
This
VOTING AGREEMENT (the “Agreement”),
dated
as of February 28, 2007, is entered into by and between NexCen Brands,
Inc.,
a
Delaware corporation (the “Company”),
Xxxxxx
Xxxxxx and Xxxxxxxx X. Xxxxxxx (collectively, the “Majority
Securityholders”).
WHEREAS,
the Company, MM Acquisition Sub, LLC, a Delaware limited liability company
(“Merger
Sub”),
MaggieMoo’s International, LLC, a Delaware limited liability company
(“MaggieMoo’s”),
and
the Majority Securityholders have entered into that certain Agreement and Plan
of Merger, dated as of February 14, 2007 (the “Merger
Agreement”),
pursuant to which Merger
Sub will merge with and into MaggieMoo’s;
WHEREAS,
pursuant to the terms of the Merger Agreement, in
exchange for the limited liability company interests of MaggieMoo’s,
the
Majority Securityholders, in addition to the right to receive the Cash
Consideration, (1) will have the right to receive, at the Closing, shares of
common stock, par value $0.01 per share, of the Company (“Company
Shares”)
equal
in number to the remainder of (x) the quotient obtained by dividing (A)
$2,500,000 multiplied by the Accredited Investor Percentage, by (B) the Closing
Date Reference Price; (2) may have the right, following Closing, to receive
Company Shares representing the Adjusted Holdback Amount, if any; and, (3)
may
have the right, following the Closing, to receive an additional number of
Company Shares in accordance with Section 2.14 of the Merger Agreement (all
such
Company Shares are referred to as the “Merger
Shares”);
WHEREAS,
each Majority Securityholder shall be entitled to his Pro Rata Percentage of
the
Merger Shares (collectively, the “Consideration
Shares”);
and
WHEREAS,
on the terms and conditions set forth in the Merger Agreement, the Majority
Securityholders desire and agree to be bound by the restrictions on transfer,
and to vote all Consideration Shares issued to them pursuant to the terms of
the
Merger Agreement as set forth herein.
NOW,
THEREFORE, in consideration of the premises contained herein and for other
good
and valuable consideration, the receipt, sufficiency and adequacy of which
is
hereby acknowledged, the parties hereto agree as follows (with all capitalized
terms used and not otherwise defined herein having their respective meanings
as
set forth in the Merger Agreement):
1. Agreement
to Vote Shares; Irrevocable Proxy.
Each
Majority Securityholder hereby appoints such
person as the Board of Directors of the Company may designate from time to
time
(the
“Proxy
Holder”)
its
proxy and attorney-in-fact, with full power of substitution and resubstitution,
to vote or act by written consent during the term of this Agreement with respect
to the Consideration Shares (including any Company Shares included in the
Adjusted Holdback Amount, if any) and any New Shares (as defined below)
(collectively, the “Shares”).
The
Majority Securityholders shall take such further action or execute such other
instruments as may be necessary to effectuate the intent of this proxy and
limited power of attorney. The proxy and limited power of attorney granted
hereunder by the Majority Securityholders shall be irrevocable during the term
of this Agreement and shall revoke any and all prior proxies granted by the
Majority Securityholders with respect to the matters contemplated hereunder.
The
power of attorney granted by the Majority Securityholders herein is a limited
durable power of attorney and shall survive the bankruptcy, death or incapacity
of the Majority Securityholders. The proxy and limited power of attorney granted
hereunder shall terminate upon the termination of this Agreement. All parties
hereto acknowledge and agree that the Proxy Holder shall, and the Majority
Securityholders hereby irrevocably consent to, vote all Shares owned by them
in
favor of matters recommended or approved by the Board of Directors of the
Company, or, if such matters are neither recommended nor approved by the Board
of Directors of the Company, then at the direction of the Board of Directors
of
the Company, in respect of all matters for which stockholder approval is sought
or required. Notwithstanding anything to the contrary, the provisions of this
Section 1 shall not apply with respect to any Shares that have been validly
Transferred (as hereinafter defined) by either of the Majority Securityholders
(or its permitted transferees or successors in interest) to a third party in
compliance with Section 4
hereof.
2. No
Voting Trusts or Other Arrangements.
Each of
the Majority Securityholders agrees that he will not, and will not permit any
entity under his or its control to, grant any proxies with respect to the Shares
or subject any of the Shares to any arrangement with respect to the voting
of
the Shares other than this Agreement.
3. Majority
Securityholder Capacity.
Notwithstanding anything to the contrary set forth herein, each of the Majority
Securityholders is entering into this Agreement solely in such Majority
Securityholder’s capacity as the holder of the Shares, as may become applicable,
and nothing in this Agreement shall prevent any of the Majority Securityholders
from taking any action or omitting to take any action in the Majority
Securityholders’ capacity as an officer or employee of the Company or any of its
subsidiaries, in either case as applicable or as may become applicable to the
Majority Securityholders.
4. Transfer
and Encumbrance.
(a) Each
of
the Majority Securityholders represents and warrants, as to himself, that (i)
the Consideration Shares are free and clear of all liens, claims, charges,
security interests or other encumbrances, other than those that may be created
by the Merger Agreement and this Agreement, (ii) there are no options, warrants
or other rights, agreements, arrangements or commitments of any character to
which the Majority Securityholders are a party relating to the pledge,
disposition or voting of the Shares, and there are no voting trusts or voting
agreements with respect to the Shares, other than this Agreement, (iii) he
has
full power and authority to enter into, execute and deliver this Agreement
and
to perform fully his obligations hereunder and (iv) this Agreement constitutes
the legal, valid and binding obligation of him in accordance with its terms.
(b) On
or
after the date hereof and during the term of this Agreement, in accordance
with
the terms and conditions set forth Section 7.2 of the Merger Agreement
(including but not limited to the lock-up periods set forth therein), each
of
the Majority
Securityholders shall not, and shall not agree to, (i) sell, transfer,
hypothecate, negotiate, pledge, assign, encumber, grant any option, warrant
or
other right to purchase, or otherwise dispose of, or (ii) enter into any swap
or
any other agreement or any transaction that transfers, in whole or in part,
directly or indirectly, the economic consequence of ownership of ((i) and (ii)
collectively, “Transfer”)
any
Company Shares, except to one or more partners or members of each of the
Majority Securityholders or to an affiliated corporation under common control
with either of the Majority Securityholders (but then only if, as a precondition
to such transfer, the transferee agrees in a writing, reasonably satisfactory
in
form and substance to the Company and the Proxy Holder, to be bound by the
terms
of this Agreement and each of the Majority Securityholders (as applicable)
has
delivered to the Company an opinion of counsel in form and substance
satisfactory to the Company and its counsel, to the effect that no registration
of the Shares under the Securities Act is required).
5. New
Shares.
Each of
the Majority Securityholders agrees that all Shares received as a result of
any
stock splits, stock dividends or reclassifications of Consideration Shares
(all
such Shares collectively, “New
Shares”),
shall
be subject to the terms of this Agreement to the same extent as if they
constituted Consideration Shares as of the date hereof.
6. Specific
Performance.
Each
party hereto acknowledges that it will be difficult to measure in money the
damage to the other party if a party hereto fails to comply with any of the
obligations imposed by this Agreement in the event of any such failure, the
other party will not have an adequate remedy at law or damages. Accordingly,
each party hereto agrees that injunctive relief or other equitable remedy,
in
addition to remedies at law or damages, is the appropriate remedy for any such
failure and will not oppose the granting of such relief on the basis that the
other party has an adequate remedy at law. Each party hereto agrees that it
will
not seek, and agrees to waive any requirement for, the securing or posting
of a
bond in connection with any other party’s seeking or obtaining such equitable
relief.
2
7. Entire
Agreement.
This
Agreement supersedes all prior agreements, written or oral, among the parties
hereto with respect to the subject matter hereof and contains the entire
agreement among the parties with respect to the subject matter hereof. This
Agreement may not be amended or supplemented, and no provisions hereof may
be
modified or waived, except by an instrument in writing signed by all the parties
hereto. No waiver of any provisions hereof by any party shall be deemed a waiver
of any other provision hereof by any such party, nor shall any such waiver
be
deemed a continuing waiver of any provision hereof by such party.
8. Notices.
All
notices hereunder shall be in writing and shall be deemed given when delivered
personally, upon receipt of a transmission confirmation if sent by facsimile
or
like transmission or on the next business day when sent by Federal Express,
Express Mail or other reputable overnight courier service to the parties at
the
following addresses (or at such other address for a party as shall be specified
by like notice):
If
to the
Company:
1330
Avenue of the Xxxxxxxx
00xx
Xxxxx
Xxx
Xxxx,
XX 00000
Attention:
Xxxxx
Xxxxx
Fax: 000-000-0000
With
a
copy (which shall not constitute notice to the Company) to:
Xxxxxxxx
& Xxxxx LLP
000
00xx
Xxxxxx,
X.X.
Xxxxxxxxxx,
XX 2005
Attention:
Xxxxxx
Xxxxxx, Esq.
Fax:
000-000-0000
If
to the
Majority Securityholders, to the address or facsimile number set forth for
each
of the Majority Securityholders on the signature page hereof.
9. Miscellaneous.
(a) In
addition to other legends that are required, either by agreement or by federal
or state securities laws, each certificate representing any of the Shares shall
be marked by the Company with a legend substantially in the following
form:
“THE
SALE, TRANSFER, HYPOTHECATION, NEGOTIATION, PLEDGE, ASSIGNMENT, ENCUMBRANCE,
GRANT OF ANY OPTION, WARRANT OR OTHER RIGHT TO PURCHASE, OR OTHER DISPOSITION
(COLLECTIVELY, “TRANSFER”)
OF THE
SHARES EVIDENCED BY THIS CERTIFICATE ARE SUBJECT TO RESTRICTIONS AND A GRANT
OF
PROXY PURSUANT TO THAT CERTAIN VOTING AGREEMENT BY AND BETWEEN THE COMPANY,
AND
THE MAJORITY SECURITYHOLDERS NAMED THEREIN, DATED AS OF FEBRUARY ___, 2007
(THE
“VOTING
AGREEMENT”),
COPIES OF EACH OF WHICH MAY BE OBTAINED FROM THE SECRETARY OF NEXCEN BRANDS,
INC. NO TRANSFER OF THE SHARES MAY BE MADE UNLESS SPECIFIC CONDITIONS OF THE
VOTING AGREEMENT ARE SATISFIED.
3
(b) THIS
AGREEMENT SHALL BE DEEMED TO BE MADE IN AND IN ALL RESPECTS SHALL BE
INTERPRETED, CONSTRUED AND GOVERNED BY AND IN ACCORDANCE WITH THE LAWS OF THE
STATE OF DELAWARE WITHOUT REGARD TO THE CONFLICT OF LAW PRINCIPLES
THEREOF.
The
parties hereby irrevocably submit to the exclusive jurisdiction of the courts
of
the State of Delaware and the Federal courts of the United States of America,
in
each case sitting in Delaware, solely in respect of the interpretation and
enforcement of the provisions of this Agreement and in respect of the
transactions contemplated hereby, and hereby waive, and agree not to assert,
as
a defense in any action, suit or proceeding for the interpretation or
enforcement hereof or of any such document, that it is not subject thereto
or
that such action, suit or proceeding may not be brought or is not maintainable
in said courts or that the venue thereof may not be appropriate or that this
Agreement may not be enforced in or by such courts, and the parties hereto
irrevocably agree that all claims with respect to such action or proceeding
shall be heard and determined in such a Delaware State or Federal court. The
parties hereby consent to and grant any such court jurisdiction over the person
of such parties and over the subject matter of such dispute and agree that
mailing of process or other papers in connection with any such action or
proceeding in the manner provided in Section 8 or in such other manner as may
be
permitted by law shall be valid and sufficient service thereof.
(c) EACH
PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS
AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE
EACH SUCH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT SUCH
PARTY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR
INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED BY THIS AGREEMENT. EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT
(i)
NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF
LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, (ii) EACH PARTY UNDERSTANDS
AND HAS CONSIDERED THE IMPLICATIONS OF THIS WAIVER, AND (iii) EACH PARTY MAKES
THIS WAIVER VOLUNTARILY.
(d) If
any
provision of this Agreement or the application of such provision to any person
or circumstances shall be held invalid or unenforceable by a court of competent
jurisdiction, such provision or application shall be unenforceable only to
the
extent of such invalidity or unenforceability, and the remainder of the
provision held invalid or unenforceable and the application of such provision
to
persons or circumstances, other than the party as to which it is held invalid,
and the remainder of this Agreement, shall not be affected.
(e) This
Agreement may be executed in one or more counterparts (including by facsimile),
each of which shall be deemed to be an original but all of which together shall
constitute one and the same instrument.
(f) This
Agreement shall terminate automatically upon the sale, transfer or other
disposition of all Company Shares held by the Majority Securityholders to
persons or entities that are not Affiliates, in compliance with Section 4(b)
hereof. For purposes hereof, the term “Affiliate” shall mean any other person or
entity who directly, or indirectly through one or more intermediaries, is in
control of, is controlled by, or is under common control with, such Majority
Securityholder. For purposes of this definition, control of an entity means
the
power, directly or indirectly, to direct or cause the direction of the
management and policies of such entity whether by contract, securities ownership
or otherwise; and the terms “controlling” and “controlled” shall have the
respective meanings correlative to the foregoing.
4
(g) Each
party hereto shall execute and deliver such additional documents as may be
necessary or desirable to effect the transactions contemplated by this
Agreement.
(h) No
party
to this Agreement may assign any of its rights or obligations under this
Agreement without the prior written consent of the other party hereto. Any
assignment contrary to the provisions of this Section 9(h) shall be null and
void.
[END
OF PAGE]
[SIGNATURE
PAGE FOLLOWS]
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IN
WITNESS WHEREOF, the parties hereto have executed and delivered this Voting
Agreement as of the date first written above.
NEXCEN BRANDS, INC., a Delaware corporation | ||
|
|
|
By: | /s/ Xxxxxx X. X’Xxxxx | |
Name: Xxxxxx X. X’Xxxxx |
||
Title: Chief Executive Officer |
MAJORITY SECURITYHOLDERS: | |
/s/ Xxxxxx Xxxxxx | |
Xxxxxx Xxxxxx |
|
/s/ Xxx X. Xxxxxxx | |
Xxx X. Xxxxxxx |
SCHEDULE
1
Name
of Majority Securityholder
|
Address
and Facsimile Number for Notices Pursuant to Section 8
|
Number
of Initial Consideration Shares
|
Xxxxxx
Xxxxxx
|
00
Xxxxxxx Xxxx
Xxx
Xxxxxxxx, XX 00000
Fax
No.:
|
154,245
|
Xxx
X. Xxxxxxx
|
00
Xxxxxxxx Xxxx
Xxxxxx
Xxxx, XX 00000
Fax
No.:
|
20,287
|