EXHIBIT 10.1
EXECUTION COPY
PRINCIPAL STOCKHOLDERS' AGREEMENT dated as of November
10, 2004 (this "Agreement"), among XXXXX APPAREL GROUP, INC.,
a Pennsylvania corporation ("Parent"), BARNEYS NEW YORK, INC.,
a Delaware corporation (the "Company"), WHIPPOORWILL
ASSOCIATES, INC., a Delaware corporation, as agent and/or
general partner for its discretionary accounts, and BAY
HARBOUR MANAGEMENT L.C., a Florida limited company, for its
managed accounts (each, a "Stockholder" and, together, the
"Stockholders").
WHEREAS, Parent, Flintstone Acquisition Corp., a Delaware
corporation and a wholly owned subsidiary of Parent ("Merger Sub"), and the
Company are entering into an Agreement and Plan of Merger dated as of the date
hereof (as the same may be amended or supplemented, the "Merger Agreement";
capitalized terms used herein but not defined herein having the meanings set
forth in the Merger Agreement as of the date hereof);
WHEREAS, each Stockholder beneficially owns the number of shares of
Company Common Stock set forth opposite its name on Schedule A hereto (such
shares of Company Common Stock, together with any other shares of capital stock
of the Company acquired by such Stockholder after the date hereof and during the
term of this Agreement being collectively referred to herein as the "Subject
Shares" of such Stockholder); and
WHEREAS, as a condition and inducement to their willingness to enter
into the Merger Agreement, Parent and Merger Sub have requested that each
Stockholder enter into this Agreement and take certain actions set forth herein;
NOW, THEREFORE, in consideration of the foregoing and the
representations, warranties, covenants and agreements contained in this
Agreement, the parties hereto agree as follows:
SECTION 1. Representations and Warranties of Each Stockholder. Each
Stockholder hereby, severally and not jointly, represents and warrants to Parent
as to itself only as follows:
(a) Organization; Authority; Execution and Delivery; No Conflicts;
Enforceability. Such Stockholder (i) is a corporation or limited company, as the
case may be, duly organized, validly existing and in good standing under the
Laws of the jurisdiction of its organization and (ii) has all requisite
(corporate or limited company, as the case may be) power and authority to
execute, deliver and perform its obligations under this Agreement. The
execution, delivery and performance of this Agreement by such Stockholder have
been duly authorized by all necessary corporate or organizational action on the
part of such Stockholder and no other corporate or organizational proceedings on
the part of such Stockholder are necessary to authorize the execution, delivery
and performance of this Agreement by such Stockholder. This Agreement has been
duly executed and delivered by such Stockholder and, assuming due execution and
delivery of this Agreement by Parent and the Company, constitutes the legal,
valid and binding obligation of such Stockholder, enforceable against such
Stockholder in accordance with its terms. The execution and delivery of this
Agreement by such Stockholder do not, and the performance by such Stockholder of
its obligations hereunder, will not, conflict with, or result in any violation
or breach of, or default (with or without notice or lapse of time or both)
under, or give rise to a right of termination, cancellation or acceleration of
any obligation, or to the loss of a material benefit under, or result in the
creation of any Lien in or upon any of the properties or other assets of such
Stockholder under, (i) any organizational documents of such Stockholder, (ii)
any Contract to which such Stockholder is a party or is bound or any of its
properties or other assets is bound by or subject to or otherwise under which
such Stockholder has rights or benefits or (iii) any Law applicable to such
Stockholder or its properties or other assets, other than, in the case of
clauses (ii) and (iii) above, any such conflicts, violations, breaches,
defaults, rights, losses or Liens that individually or in the aggregate are not
reasonably likely to impair in any material respect or prevent or materially
impede, interfere with, hinder or delay the ability of such Stockholder to
perform its obligations hereunder. No consent, approval, order or authorization
of, action by or in respect of, or registration, declaration or filing with, any
Governmental Authority is required by or with respect to such Stockholder in
connection with its execution, delivery and performance of this Agreement,
except for (x) the filing with the SEC of such reports under the Exchange Act as
may be required in connection with this Agreement and (y) such other consents,
approvals, orders, authorizations, registrations, declarations and filings the
failure of which to obtained or made individually or in the aggregate are not
reasonably likely to impair in any material respect or prevent or materially
impede, interfere with, hinder or delay the ability of such Stockholder to
perform its obligations hereunder, including the execution and delivery of such
Principal Stockholder Consent.
(b) Subject Shares. Each Stockholder is the beneficial owner of the
Subject Shares set forth opposite its name on Schedule A hereto, and each person
set forth on Schedule B hereto is the record holder of such Subject Shares set
forth opposite its name on such Schedule, in each case, free and clear of any
Liens (other than Liens created pursuant to the terms of this Agreement or
arising under Federal or state securities Laws). Other than 200,000 shares of
Company Common Stock owned by Xxxxxx Xxxxx and shares of Company Common Stock
for which stock options held by Xxxxxx Xxxxx are exercisable (collectively,
"Xxxxx Shares"), as of the date hereof, each Stockholder does not own, of record
or beneficially, any shares of capital stock of the Company other than the
Subject Shares set forth opposite its name on Schedule A hereto. Each
Stockholder has the sole right to direct the voting of such Subject Shares, and
none of such Subject Shares is subject to any voting trust or other Contract
with respect to the voting of such Subject Shares, except for the Restated
Stockholders Agreement, effective as of November 13, 1998, between the
Stockholders or as contemplated by this Agreement.
SECTION 2. Representations and Warranties of Parent. Parent hereby
represents and warrants to each Stockholder as follows: Parent is a corporation
duly organized, validly existing and in good standing under the laws of the
Commonwealth of Pennsylvania and has all requisite corporate power and authority
to execute, deliver and
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perform its obligations under this Agreement. The execution, delivery and
performance of this Agreement by Parent have been duly authorized by all
necessary corporate action on the part of Parent and no other corporate
proceeding on the part of Parent is necessary to authorize the execution,
delivery and performance of this Agreement by Parent. This Agreement has been
duly executed and delivered by Parent and, assuming due execution and delivery
of this Agreement by the Stockholders and the Company, constitutes the legal,
valid and binding obligation of Parent, enforceable against Parent in accordance
with its terms. The execution and delivery of this Agreement by Parent do not,
and the performance by Parent of its obligations hereunder will not, conflict
with, or result in any violation or breach of, or default (with or without
notice or lapse of time or both) under, or give rise to a right of, termination,
cancellation or acceleration of any obligation, or to the loss of a material
benefit under, or result in the creation of any Lien in or upon any of the
properties or other assets of Parent under, (i) any organizational documents of
Parent, (ii) any Contract to which Parent is a party or is bound or any of its
properties or other assets is bound by or subject to or otherwise under which
Parent has rights or benefits or (iii) subject to the governmental filings and
other matters referred to in Section 4.03 of the Merger Agreement, any Law
applicable to Parent or its properties or other assets, other than, in the case
of clauses (ii) and (iii) above, any such conflicts, violations, breaches,
defaults, rights, losses or Liens that individually or in the aggregate are not
reasonably likely to impair in any material respect or prevent or materially
impede, interfere with, hinder or delay the ability of Parent to perform its
obligations hereunder. Except as set forth in Section 4.03 of the Merger
Agreement, no consent, approval, order or authorization of, action by or in
respect of, or registration, declaration or filing with, any Governmental
Authority is required by or with respect to Parent in connection with its
execution, delivery and performance of this Agreement.
SECTION 3. Covenants of Each Stockholder. (a) Each Stockholder
covenants and agrees that as promptly as practicable following the execution and
delivery of the Merger Agreement by the parties thereto, such Stockholder shall
cause each record holder of such Stockholder's Subject Shares to:
(i) consent in writing to the adoption of the Merger Agreement
and the approval of the Merger and the other transactions
contemplated thereby, without a meeting, without prior notice and
without a vote by executing a Principal Stockholder Consent in the
form of Exhibit A hereto covering all such record holder's Subject
Shares; and
(ii) deliver such Principal Stockholder Consent to the
Secretary.
(b) At any meeting of stockholders of the Company or at any
adjournment thereof or in any other circumstances upon which a vote, consent or
other approval of stockholders is sought, such Stockholder shall direct the
voting of (or cause to be voted) its Subject Shares against (i) any merger
agreement or merger (other than the Merger Agreement and the Merger),
consolidation, combination, share exchange, sale of substantial assets,
reorganization, recapitalization, joint venture dissolution, liquidation or
winding up of or by the Company or any other business combination involving the
Company, (ii) any Takeover Proposal and (iii) any amendment or other change of
the
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Company Certificate or the Company By-laws or other proposal or transaction
involving the Company or any of its Subsidiaries, which amendment or other
proposal or transaction in any manner could reasonably be expected to impede,
frustrate, prevent or nullify any provision of this Agreement, the Merger
Agreement, the Debt Offer Documents or the consummation of the Merger or any
other transactions contemplated hereby or thereby or change in any manner the
voting rights of any class of Company Common Stock or Company Preferred Stock.
Each Stockholder shall not, and shall not permit the record holder of any of its
Subject Shares to, commit or agree to take any action inconsistent with the
foregoing.
(c) Other than pursuant to the terms of this Agreement, each
Stockholder shall not, directly or indirectly, (i) other than pursuant to the
Merger, sell, transfer, pledge, assign or otherwise dispose of (including by
gift or by operation of law) (collectively, "Transfer"), or enter into any
Contract or other arrangement with respect to Transfer of, or any profit sharing
arrangement relating to, any Subject Shares to or with any person, except an
Affiliate of such Stockholder or the account or person for whom such Stockholder
is acting on behalf of with respect to such Subject Shares; provided that prior
to such Transfer, or entering into such Contract or arrangement, such Affiliate,
account or person (or such Stockholder acting on behalf of such Affiliate or
person) shall become a party to this Agreement in respect of such Subject Shares
pursuant to a joinder agreement satisfactory to Parent or (ii) enter into any
voting arrangement, whether by proxy (or written consent in lieu thereof),
voting agreement or otherwise, with respect to any Subject Shares and shall not
commit or agree to take any of the foregoing actions. In furtherance of the
foregoing, each Stockholder agrees that any Transfer in violation of this
Agreement shall be void and of no force or effect.
(d) Each Stockholder shall not, nor shall it authorize or permit any
Representative of such Stockholder to, directly or indirectly, (i) solicit,
initiate or encourage any inquires or the making of any proposal that
constitutes a Takeover Proposal or (ii) enter into, continue or participate in
any discussions or negotiations regarding, or furnish to any person any
information relating to the Company in connection with, or otherwise cooperate
in any way, any Takeover Proposal. Each Stockholder shall, and shall cause each
Representative of such Stockholder to, immediately cease and cause to be
terminated all existing discussions or negotiations with any person conducted
heretofore with respect to any Takeover Proposal.
(e) Each Stockholder shall use commercially reasonable efforts to
take, or cause to be taken, all actions, and to do, or cause to be done, and to
assist and cooperate with the other parties in doing, all things reasonably
requested by Parent from such Stockholder to consummate and make effective, in
the most expeditious manner practicable, the Merger and the other transactions
contemplated hereby and by the Merger Agreement as in effect on the date hereof.
Each Stockholder shall not issue any press release or make any other public
statement with respect to the Merger Agreement, the Merger or any other
transactions contemplated hereby or by the Merger Agreement without the written
consent of Parent (which consent shall not be unreasonably withheld or delayed),
except as may be required by applicable Law or court process and after
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consultation with, and having provided an opportunity for review and comment on
such press release or other public statement by Parent to the extent
practicable.
(f) Each Stockholder hereby consents to and adopts and approves the
actions taken by the Board of Directors of the Company in adopting, approving
and declaring advisable this Agreement, the Merger Agreement, the Merger and the
other transactions contemplated hereby or thereby. Each Stockholder hereby
waives, and agrees, and shall cause the record holder of its Subject Shares to
waive, and agree, not to exercise or assert, any appraisal rights under Section
262 in connection with the Merger.
SECTION 4. Stockholder Capacity. No person executing this Agreement
who is or becomes during the term hereof a director or officer of the Company
makes any agreement or understanding herein in his or her capacity as such
director or officer of the Company. Each Stockholder signs solely in its
capacity as the beneficial owner of such Stockholder's Subject Shares. Nothing
herein shall limit or affect any actions taken by any Stockholder (or
Representatives acting on its behalf) in its capacity as an officer or director
of the Company.
SECTION 5. Stop Transfer. The Company agrees with, and covenants to,
Parent that the Company shall not register the transfer of any certificate
representing any Stockholder's Subject Shares in violation of this Agreement.
SECTION 6. Termination. This Agreement shall terminate upon the
earliest of (i) the Effective Time and (ii) the termination of the Merger
Agreement in accordance with its terms; provided, however, that any such
termination shall not relieve any party of any liability of such party arising
as a result of the breach of this Agreement prior to such termination.
SECTION 7. Additional Matters. (a) Each Stockholder shall, and shall
cause the record holder of its Subject Shares to, from time to time, execute and
deliver, or cause to be executed and delivered, such additional or further
consents, documents and other instruments as Parent may reasonably request for
the purpose of effectively carrying out the transactions contemplated by this
Agreement and the Merger Agreement.
SECTION 8. General Provisions.
(a) Amendments. This Agreement may not be amended except by an
instrument in writing signed by each of the parties hereto, provided that the
approval or consent of the Company shall not be required for any such amendment
except to the extent such amendment imposes additional obligations on the
Company.
(b) Notice. All notices and other communications hereunder shall be
in writing and shall be deemed given if delivered personally or sent by
overnight courier (providing proof of delivery) to Parent or to the Company in
accordance with Section 9.02 of the Merger Agreement and to the Stockholders at
their respective addresses set forth on Schedule A hereto (or at such other
address for a party as shall be specified by like notice).
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(c) Definition. For purposes of this Agreement, "person" means an
individual, corporation, partnership, limited liability company, joint venture,
joint stock company, Governmental Authority, association, trust, unincorporated
organization or other entity.
(d) Interpretation. When a reference is made in this Agreement to a
Section, Exhibit or Schedule, such reference shall be to a Section of, or an
Exhibit or Schedule to, this Agreement unless otherwise indicated. The headings
contained in this Agreement are for reference purposes only and shall not affect
in any way the meaning or interpretation of this Agreement. Whenever the words
"include", "includes" or "including" are used in this Agreement, they shall be
deemed to be followed by the words "without limitation". The words "hereof",
"hereto", "hereby", "herein" and "hereunder" and words of similar import when
used in this Agreement shall refer to this Agreement as a whole and not to any
particular provision of this Agreement. The words "date hereof" shall refer to
the date of this Agreement. The term "or" is not exclusive. The word "extent" in
the phrase "to the extent" shall mean the degree to which a subject or other
thing extends, and such phrase shall not mean simply "if". All terms defined in
this Agreement shall have the defined meanings when used in any certificate or
other document made or delivered pursuant hereto unless otherwise defined
therein. The definitions contained in this Agreement are applicable to the
singular as well as the plural forms of such terms and to the masculine as well
as to the feminine and neuter genders of such term. Any Contract, instrument or
statute defined or referred to herein or in any Contract or instrument that is
referred to herein means such Contract, instrument or statute as from time to
time amended, modified or supplemented, including (in the case of Contracts) by
waiver or consent and (in the case of statutes) by succession of comparable
successor statutes and references to all attachments thereto and instruments
incorporated therein. References to a person are also to its permitted
successors and assigns.
(e) Counterparts. This Agreement may be executed in one or more
counterparts (including by telecopy), all of which shall be considered one and
the same agreement and shall become effective when one or more counterparts have
been signed by each of the parties and delivered to the other parties.
(f) Entire Agreement; No Third-Party Beneficiaries. This Agreement,
the Confidentiality Agreement and the Merger Agreement (i) constitute the entire
agreement and supersede all prior agreements, understandings and negotiations,
both written and oral, among the parties with respect to the subject matter of
this Agreement, the Confidentiality Agreement and the Merger Agreement and (ii)
except for the provisions of Article II of the Merger Agreement and Section 6.04
of the Merger Agreement, are not intended to confer upon any person other than
the parties hereto (and their respective successors and assigns) or thereto (and
their respective successor and assigns) any rights or remedies hereunder.
(g) Governing Law. 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.
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(h) Assignment. Neither this Agreement nor any of the rights,
interests or obligations under this Agreement shall be assigned, in whole or in
part, by operation of Law or otherwise, by Parent without the prior written
consent of a Stockholder (with respect to such Stockholder) or by any
Stockholder without the prior written consent of Parent or by the Company
without the prior written consent of Parent. Subject to the preceding sentence,
this Agreement will be binding upon, inure to the benefit of, and be enforceable
by, the parties and their respective successors and assigns.
(i) Jurisdiction; Waiver of Jury Trial. Each of the parties hereto
hereby agrees that any claim, suit, action or other proceeding, directly or
indirectly, arising out of, under or relating to this Agreement shall be heard
and determined in the Chancery Court of the State of Delaware (and each agrees
that no such claim, action, suit or other proceeding relating to this Agreement
shall be brought by it or any of its Affiliates except in such court), and the
parties hereto hereby irrevocably and unconditionally submit to the exclusive
jurisdiction of any such court in any such claim, suit, action or other
proceeding and irrevocably and unconditionally waive the defense of an
inconvenient forum to the maintenance of any such claim, suit, action or other
proceeding. Each of the parties hereto further agrees that, to the fullest
extent permitted by applicable Law, service of any process, summons, notice or
document by U.S. registered mail to such person's respective address set forth
on Schedule A hereto or Section 9.02 of the Merger Agreement, as the case may
be, shall be effective service of process for any claim, action, suit or other
proceeding in Delaware with respect to any matters to which it has submitted to
jurisdiction as set forth above in the immediately preceding sentence. Each of
the Stockholders herby appoints the Company as its agent for service of process
for any claim, action, suit or other proceeding in Delaware with respect to any
matters to which it has submitted to jurisdiction as set forth above. The
parties hereto hereby agree that a final judgment in any such claim, suit,
action or other proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by
applicable Law.
EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHTS IT MAY HAVE TO TRIAL BY
JURY IN ANY CLAIM, SUIT, ACTION OR OTHER PROCEEDING DIRECTLY OR INDIRECTLY
ARISING OUT OF, UNDER OR RELATED TO THIS AGREEMENT. EACH PARTY HERETO HEREBY (I)
CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH PARTY WOULD NOT, IN THE EVENT OF
ANY CLAIM, ACTION, SUIT OR PROCEEDING, SEEK TO ENFORCE THE FOREGOING WAIVER AND
(II) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO
ENTER INTO THIS AGREEMENT, BY, AMONG OTHER THINGS, THE MUTUAL WAIVER AND
CERTIFICATIONS IN THIS SECTION 8(i).
(j) Specific Enforcement. Each of the parties hereto hereby agrees
that irreparable damage would occur in the event that any of the provisions of
this Agreement were not performed in accordance with their specific terms or
were otherwise breached.
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It is accordingly agreed that the parties hereto shall be entitled to an
injunction or injunctions to prevent breaches of this Agreement and to enforce
specifically the terms and provisions of this Agreement in the Chancery Court of
the State of Delaware, without bond or other security being required, this being
in addition to any other remedy to which they are entitled at law or in equity.
(k) Severability. If any term or other provision of this Agreement
is invalid, illegal or incapable of being enforced by any rule of law or public
policy, all other conditions and provisions of this Agreement shall nevertheless
remain in full force and effect. Upon such determination that any term or other
provision is invalid, illegal or incapable of being enforced, the parties hereto
shall negotiate in good faith to modify this Agreement so as to effect the
original intent of the parties as closely as possible to the fullest extent
permitted by applicable Law in an acceptable manner to the end that the
transactions contemplated hereby are fulfilled to the extent possible.
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IN WITNESS WHEREOF, Parent, the Company, Whippoorwill Associates,
Inc., as agent and/or general partner for its discretionary accounts, and Bay
Harbour Management L.C., for its managed accounts, have caused this Agreement to
be signed by their respective officers thereunto duly authorized, all as of the
date first written above.
XXXXX APPAREL GROUP, INC.,
By /s/ Xxxxx Xxxxxxxxx
---------------------------------
Name: Xxxxx Xxxxxxxxx
Title: President and CEO
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BARNEYS NEW YORK, INC.,
By /s/ Xxxxxx X. Xxxxxxx
-----------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: EVP and CFO
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WHIPPOORWILL ASSOCIATES, INC., AS
AGENT AND/OR GENERAL PARTNER
FOR ITS DISCRETIONARY ACCOUNTS
By /s/ Xxxxx X. Xxxxxxxxxxx
-----------------------------------
Name: Xxxxx X. Xxxxxxxxxxx
Title: Managing Director
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BAY HARBOUR MANAGEMENT L.C.,
FOR ITS MANAGED ACCOUNTS
By /s/ Xxxxxx Xxx Xxxx
-----------------------------------
Name: Xxxxxx Xxx Xxxx
Title: Managing Principal
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