VOTING AGREEMENT
This
VOTING AGREEMENT (the “Agreement”),
dated
as of August 7, 2007, is entered into by and among NexCen Brands,
Inc.,
a Delaware corporation (the “Company”),
Pretzelmaker
Franchising, LLC, a Delaware limited liability company (“Pretzelmaker”),
and
Pretzel Time Franchising, LLC, a Delaware limited liability company
(“Pretzel
Time,”
and
collectively with Pretzel Maker, the “Holders”).
WHEREAS,
the Company, NexCen Asset Acquisition, LLC, a Delaware limited liability company
(the “Buyer”),
Xxx.
Xxxxxx’ Famous Brands, LLC, a Delaware limited liability company, and the
Holders have entered into that certain Asset Purchase Agreement, dated as of
August 7, 2007 (the “Purchase
Agreement”),
pursuant to which Buyer has agreed to acquire certain of the assets that relate
to the operation of Pretzel Time and Pretzelmaker;
WHEREAS,
pursuant to the terms of the Purchase Agreement, the Holders (1) will be issued,
at the Closing, shares of common stock, par value $0.01 per share, of the
Company (“Company
Shares”)
in
accordance with Sections 3.2 and 3.3 of the Purchase Agreement; (2) subject
to
the terms of the Purchase Agreement, will be issued and will receive the Company
Shares representing the Indemnity Escrow Amount upon release therefrom; (3)
subject to the terms of the Purchase Agreement, will be issued and will receive
the Company Shares representing the Developing Agents Escrow Amount upon release
therefrom; and, (4) may, following the Closing, receive an additional number
of
Company Shares in accordance with Section 3.2(f) of the Purchase Agreement
(all
such Company Shares are referred to as the “Consideration
Shares”);
and
WHEREAS,
on the terms and conditions set forth in the Purchase Agreement, the Holders
desire and agree to be bound by the restrictions on transfer, and to vote all
Company Shares issued to them pursuant to the terms of the Purchase 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 Purchase Agreement):
1. Agreement
to Vote Shares; Irrevocable Proxy.
Each
Holder hereby appoints such person as the Board of Directors of the Company
may
appoint after the date of this Agreement (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 Escrow
Amount, if any) and any New Shares (as defined below) (collectively, the
“Shares”).
Holders 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 Holders
shall be irrevocable during the term of this Agreement, shall be deemed to
be
coupled with an interest sufficient in law to support an irrevocable proxy
and
shall revoke any and all prior proxies granted by Holder with respect to the
matters contemplated hereunder. The power of attorney granted by Holders herein
is a limited durable power of attorney and shall survive the bankruptcy, death
or incapacity of the Holders. 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 Holders 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 any of the Holders (or its permitted transferees or
successors in interest) to a third party in compliance with Section
3
hereof.
2. No
Voting Trusts or Other Arrangements.
Each of
the Holders 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. Transfer
and Encumbrance.
(a) Each
of
the Holders represents and warrants 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 Purchase Agreement,
the Escrow Agreement, the Indenture, the Collateral Agreements (as defined
in
the Indenture), and this Agreement, (ii) there are no options, warrants or
other
rights, agreements, arrangements or commitments of any character to which the
Holders 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 and applicable trust agreements for estate planning
purposes, including but not limited to charitable remainder trusts, (iii) each
of the Holders has full power and authority to enter into, execute and deliver
this Agreement and to perform fully the Holders’ obligations hereunder and (iv)
this Agreement constitutes the legal, valid and binding obligation of the
Holders in accordance with its terms.
(b) On
or
after the date hereof and during the term of this Agreement, except to the
extent permitted by Section 7.8 of the Purchase Agreement, each of the
Holders
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 (x) to one or more partners or members of each of
the
Holders or to an affiliated corporation under common control with either of
the
Holders (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 Holders (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), subject further to the restrictions set forth in the Escrow Agreement
or (y) to the Company, in the case of the Escrow Amount being transferred
pursuant to the Escrow Agreement and Purchase Agreement.
2
4. New
Shares.
Each of
the Holders 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.
5. 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.
6. 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.
7. 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, email 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 or the Proxy Holder:
1330
Avenue of the Xxxxxxxx
00xx
Xxxxx
Xxx
Xxxx,
XX 00000
Attention: Xxxxx
Xxxxxxx, CFO
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 00000
Attention: Xxxx
X.
Director, Esq.
Fax:
000-000-0000
If
to the
Holders, to the address or facsimile number or email address set forth for
each
of the Holders on Schedule 1 hereto.
3
8. 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 NEXCEN BRANDS,
INC. AND THE HOLDERS NAMED THEREIN, DATED AS OF AUGUST 7, 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.”
(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 7 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.
4
(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 Holders 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 Holder. 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.
(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 8(h) shall be null and
void.
[SIGNATURE
PAGE FOLLOWS]
5
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 | ||
| HOLDERS: | ||
| PRETZELMAKER FRANCHISING, LLC | ||
| |
|
|
| By: | /s/ Xxxxxxx Xxxx | |
|
Name: Xxxxxxx Xxxx |
||
| Title: EVP and Chief Legal Officer | ||
| PRETZEL TIME FRANCHISING, LLC | ||
| |
|
|
| By: | /s/ Xxxxxxx Xxxx | |
|
Name: Xxxxxxx Xxxx |
||
| Title: EVP and Chief Legal Officer | ||
SCHEDULE
1
|
Name
of Holder
|
Address
for Notices Pursuant to Section 7
|
|
Pretzel
Time Franchising, LLC
|
0000
Xxxx Xxxxxxxxxx Xxxxxxx
Xxxxx
000
Xxxx
Xxxx Xxxx, XX 00000
Fax:
(000) 000-0000
|
|
Pretzelmaker
Franchising, LLC
|
0000
Xxxx Xxxxxxxxxx Xxxxxxx
Xxxxx
000
Xxxx
Xxxx Xxxx, XX 00000
Fax:
(000) 000-0000
|
